1. Jessica and Simon are recent university graduates with degrees in accounting and finance. Both persons want to become chartered accountants. However, while Jessica wants to become a partner at a BIG Four Audit Firm, Simon sees himself as a future chief financial officer at a multinational company. They were having an extensive discussion on the conceptual framework and Simon thinks that the conceptual framework is an accounting standard, which is constantly disputed by Jessica who thinks that this is not the case, but the conceptual framework overrides specific international financial reporting standard (IFRS). Required: a. Define and outline the main components of the conceptual framework. b. Do you think Jessica and Simon's arguments are correct? Discuss. c. Outline two main advantages and disadvantages of the framework. d. Indicate the main objective of producing general purpose financial statements. e. State the principal users of financial statements. 2. Jody-Ann is currently pursuing her accounting degree which she thinks is very difficult. She has just departed her first lecture on preparing advanced financial statements. During the lecture it was suggested that the preparation of financial statements is generally restricted to highly important constraints. Consequently, she left the lecture very confused not understanding what these constraints are. Required: a. Outline the possible constraints which might affect the measurement and recognition of elements in the financial statements. b. Outline and define the elements of the financial statements. c. Outline the underlying assumption when preparing financial statements and its importance. 3. IASB's conceptual framework outline the qualitative characteristics as an important component of the conceptual framework. Required: a. Outline the two main qualitative characteristics of the conceptual framework and their individual components. b. State the main characteristics of an asset and discuss. c. Briefly discuss the relationship between the accrual and matching concept in accounting. d. Some persons are of the view that ALL assets are legally owned by reporting entities and ALL liabilities are legally owed at the reporting date. Do you agree