1. (Conceptual Framework-General) Roger Morgan has some questions regarding the theoretical framework in which standards are set. He knows that the FASB and other predecessor organizations have attempted to develop a conceptual framework for accounting theory formulation. Yet, Roger's supervisors have indicated that these theoretical frameworks have little value in the practical sense (i.e., in the real world). Roger did notice that accounting standards seem to be established after the fact rather than before. He thought this indicated a lack of theory structure but never really questioned the process at school because he was too busy doing the homework. Roger feels that some of his anxiety about accounting theory and accounting semantics could be alleviated by identifying the basic concepts and definitions accepted by the profession and considering them in light of his current work. By doing this, he hopes to develop an appropriate connection between theory and practice.
(a) Help Roger recognize the purpose of and benefit of a conceptual framework.
(b) Identify any Statements of Financial Accounting Concepts issued by FASB that may be helpful to Roger in developing his theoretical background.