Critical Analyses on Conceptual Framework for Financial Reporting

The 2018 revised Conceptual Framework for Financial Reporting by the International Accounting Standards Board represents a strategic response to the increasing complexity of the global economic environment and the diversification of financial information needs. This study focuses on three core revisions: (1) the redefinition of stewardship, reinforcing the accountability dimension of management’s resource oversight; (2) the reinstatement of the prudence principle, establishing a financial reporting buffer mechanism under uncertainty; and (3) the paradigm shift in the definitions of assets and liabilities, replacing the “expected flow of economic benefits” with a “potential to produce economic benefits” criterion. Through systematic literature analysis, the findings reveal that while these revisions theoretically enhance the decision-usefulness of financial information, they also expose structural contradictions in practice, such as insufficient industry adaptability and ambiguous operational standards. The research not only elucidates the intrinsic logic of the conceptual framework’s evolution but also provides policy optimization pathways for future IASB revisions within a cross-cultural context.