Introduction
The Australian Accounting Standards Board or AASB is the standard-setting body in the country. This independent organization prepared a compiled version of the framework for preparation and presentation of financial statements.
In this connection, this business report is written to explore several accounting concepts for purposes of better understanding. Definition of each element of financial statements, their recognition, essential characteristics of assets, going concern assumption, probability of future economic benefits, concepts of capital and capital maintenance, and segment reporting in the context of an ASX listed company are the topics explored and covered within this report.
For purposes of applying the concepts (in select parts of the main discussions), the financial statements of Accent Group Limited are utilized; such statements are part of the company’s 2018 annual report. Accent is an ASX listed company that sells footwear and apparel products; some popular brands include CAT, Merrell, Skechers, Platypus, and VANS (Reuters, 2019).
The Accounting Conceptual Framework: Select Concepts
Categories of Financial Statement Elements
As to financial position.
There are three categories of elements of financial statements that communicate financial position information. These are assets, liabilities, and equity (AASB, 2014).
Assets.
According to the conceptual framework (AASB, 2014, p. 11), assets are elements that embody future economic benefits. Some examples of Accent’s assets include cash and cash equivalents, trade and other receivables, inventories, property, plant, and equipment, and intangibles (Accent, 2018, p. 25).
Liabilities.
The next major category that communicates financial position information is liabilities. The conceptual framework’s definition (AASB, 2014, p. 11) includes the outflow of economic resources. Accent’s statement of financial position as of July 1, 2018 reports trade and other payables, borrowings, derivative financial instruments, and deferred lease incentives as part of its liabilities.
Equity.
This category of financial position element has a residual definition; an element that is technically neither an asset nor a liability, as per the framework (AASB, 2014, p. 12). Accent reports four major classes of equity items on its 2018 statement of financial position, namely issued capital, reserves, accumulated losses, and non-controlling interest (Accent, 2018, p. 25).
As to financial performance.
Income.
For elements that communicate about financial performance for a period of time, these are reported through the preparation of a statement of profit or loss and other comprehensive income, which is still popularly called as income statement. According to the framework (AASB, 2014, p. 17), an item of income is any “increase in economic benefits” that ultimately increases

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