You have recently being asked to participate in a symposium at an accounting conference. One of the sessions at the conference is discussing concerns with the conceptual framework. You have been provided with a number of questions ahead of time so that you can be prepared for the debate.

1. The first discussion topic relates to prudence. Prudence (conservatism) was dropped from the conceptual framework when it was amended in 2010. Are we not still conservative in accounting policies? Provide some specific examples. The Exposure Draft recommends reintroduction of the term prudence, stating that it supports neutrality. The new definition of prudence would be the concern that assets and income not be overstated and expenses not beunderstated. Do you agree?

2. The second discussion topic relates to the question of how to measure assets and liabilities. What are the pros and cons of the use of historical costs compared to current values? Which method is more relevant for the statement of financial position compared to the income statement for users? Are certain types of assets more suited to the use of current values?

3. The final discussion topic relates to other comprehensive income (OCI) and comprehensive income. What is a concern with OCI and comprehensive income? Do you think OCI is useful? If so, in which situations?

Required:
In preparation for the symposium prepare notes to address the questions that might be asked concerning the conceptual framework.