Question 1
You are a graduate accountant employed by Murray Certified Practising Accountants. One of your clients, Sandy Herold, has enquired as to why you have not included the employees of her company as assets in the financial statements for the year ended 30 June 2012.
Use the AASB Framework's definition and recognition criteria of assets to explain to Sandy why you have excluded employees from the financial statements.
Question 2
You have just been employed as an accounting lecturer. In your first class, your students ask you the following questions.
(a) Who has to comply with accounting standards? How is this determined?
(b) Where can I find accounting standards?
(c) What is the primary objective of General Purpose Financial Reports?
(d) What are the qualities that make financial statements 'useful'