Reference no: EM133247001

The AASB Framework for the Preparation and Presentation of Financial Reports separates the definitions of the elements of financial reports from the recognition criteria for those elements. Arguably if an item under review fits the definition of, for example, an asset, then it is an asset and should be reported as such on the balance sheet. Following this argument, logically then, the recognition criteria would not be important in determining whether an asset should be reported in the financial reports. Critically evaluate this proposition. Your answer should include a discussion of how well such a treatment would fit with the Qualitative Characteristics of Financial Reports as outlined in the AASB Framework for the Preparation and Presentation of Financial Statements