(b) The traditional definition of expenses in financial accounting refers to the costs. incurred in the process of generating revenue. They represent the consumption of goods or services and can come in various forms, such as salaries for employees, rent for office space, utilities, depreciation on assets, and cost of goods sold, among others. Moreover, expenses are matched with revenues as per the matching principle, which states that expenses should be recognized in the same accounting period as the revenues they help generate.

Required:

Considering the evolving expectations of modern stakeholders, discuss the implications of this definition of expenses in capturing a company's social and environmental commitments and costs under the traditional financial accounting framework.