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Contents

2.1 Scope

2.2 Objective of financial statements.

2.2.1 Extract from FRS102: Section 2.1A-2.3.

2.2.2 OmniPro comment.

2.3 Qualitative characteristics of information in financial statements.

2.3.1 Extract from FRS102: Section 2.4-2.14.

2.3.2 OmniPro comment.

2.4 Definition of an asset and recognition criteria.

2.4.1 Extract from FRS102: Section 2.15(a), Section 2.17-2.19, Section 2.29 and Section 2.37-2.38.

2.4.2 OmniPro comment.

2.4.2.1 Asset defined.

2.4.2.2 When an asset is to be recognised.

2.5 Definition of a liability and recognition criteria.

2.5.1 Extract from FRS102: Section 2.15(b), Section 2.17, Section 2.20-2.21, Section 2.29. Section 2.31-2.32 and Section 2.39-2.40.

2.5.2 OmniPro comment.

2.5.2.1 Liability defined.

2.5.2.2 Recognition criteria for a liability.

2.6 Definition of Equity.

2.6.1 Extract from FRS102: Section 2.15(c) and Section 2.22.

2.6.2 OmniPro comment.

2.7 Definition and recognition of Income/revenue.

2.7.1 Extract from FRS102: Section 2.23(a), Section 2.25 and Section 2.41.

2.7.2 OmniPro comment.

2.7.2.1 Definition of income.

2.7.2.2 Identifying revenue from other income/gains.

2.7.2.3 Recognition of income.

2.8 Definition and recognition of expenses.

2.8.1 Extract from FRS102: Section 2.23(b), Section 2.26 and Section 2.42.

2.8.2 OmniPro comment.

2.8.2.1 Definition of an expense.

2.8.2.2 Recognition of an expense.

2.8.2.3 Identifying expenses from losses.

2.8 Measurement of assets, liabilities, income and expenses.

2.8.1 Extract from FRS102: Section 2.33-.2.34.

2.9 Pervasive recognition and measurement principles.

2.9.1 Extract from FRS102: Section 2.35.

2.9.2 OmniPro comment.

2.10 Accrual basis.

2.10.1 Extract from FRS102: Section 2.36.

2.10.2 OmniPro comment.

2.11 Recognition in financial statements.

2.11.1 Extract from FRS102: Section 2.43-2.45.

2.11.2 OmniPro comment.

2.12 Offsetting.

2.12.1 Extract from FRS102: Section 2.52.

2.12.2 OmniPro comment.

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2.1 Scope

Section 2 sets out the objective of financial statements, which is to provide useful information about the entity’s financial position, performance and cash flows, and sets out the concepts and underlying principles of preparation. The purpose of Section 2 is to assist preparers in determining the accounting treatment in a transaction that is not covered by the specific standards.

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Examples

Example 1: Turnover/revenue versus other income.

Example 2: Turnover/revenue versus other income. 

Example 3: Turnover/revenue versus other income.

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