Utilization of probabilities in the preparation of financial information: Perspectives from International Financial Reporting Standards

Authors

DOI:

https://doi.org/10.15381/quipu.v31i65.25864

Keywords:

probability, uncertainty, measurement, believe, Bayesian approach

Abstract

Objective: To analyze the concept of probability that is described in the International Financial Reporting Standards (IFRS). Method: Qualitative, partially descriptive, focused on content analysis of previous literature and the IFRS regulatory framework. The unit of study was the concept of probability. Results: The findings highlight the importance of using probabilities in the normative framework of IFRS, emphasizing the analysis of various scenarios regarding the future. Moreover, a thorough understanding of probability theory is crucial to have a clear conception of the term "probability" and its proper interpretation. Conclusion: It is necessary to analyze the various scenarios about the future from the Bayesian approach and fully comprehend its interpretation. Additionally, it is important to address the lack of precision in the term "probability" and its impact on its application in the preparation of financial statements.

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Author Biography

  • Rosa Milagros Castañeda Moreano, Pontificia Universidad Católica del Perú, Lima. Peru

    Doctor (C) in Accounting and Business Administration from Universidad Nacional Mayor de San Marcos, and Master in Banking and Finance from the same university. Degree in Accounting from the Pontificia Universidad Católica del Perú. Member of the Accounting Research Commission of the Interamerican Accounting Association (AIC) with publications in indexed journals and speaker at International Accounting Congresses. Lecturer in undergraduate and graduate courses in Research Seminar, Auditing and Accounting.

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Published

2023-07-31

Issue

Vol. 31 No. 65 (2023)

Section

Original papers

License

Copyright (c) 2023 Rosa Milagros Castañeda Moreano

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

AUTHORS RETAIN THEIR RIGHTS:

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b. Authors retain their right to share, copy, distribute, perform and publicly communicate their article (eg, to place their article in an institutional repository or publish it in a book), with an acknowledgment of its initial publication in Quipukamayoc .

c. Authors retain theirs right to make a subsequent publication of their work, to use the article or any part thereof (eg a compilation of his papers, lecture notes, thesis, or a book), always indicating the source of publication (the originator of the work, journal, volume, number and date).

How to Cite

Castañeda Moreano, R. M. (2023). Utilization of probabilities in the preparation of financial information: Perspectives from International Financial Reporting Standards. Quipukamayoc, 31(65), 21-30. https://doi.org/10.15381/quipu.v31i65.25864