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The IASB's Framework for the Preparation and Presentation of Financial Statements requires financial statements to be prepared on the basis that they comply with certain accounting concepts, underlying assumptions and qualitative characteristics, Five of these are matching/accruals, substance over form, prudence, comparability and materiality.
Problem (1) Briefly explain the meaning of each of the above concepts/assumptions
Problem (2) For most entities, applying the appropriate concepts/assumptions in accounting for Property, Plant and Equipment is an important element in preparing their financial statements.
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