"Financial Report":Financial Reporting Standards

B is correct. Under the joint conceptual framework project of the IASB and the FASB, accounting standards should be principles based, internally consistent, and converged. The goal of the joint framework is to move away from the independent development of accounting standards.

A is incorrect. Accounting standards should be principles based.

C is incorrect. Accounting standards should be internally consistent.

B is correct. By understanding the economic purpose of a transaction and applying the conceptual framework, an analyst may be able to evaluate the potential effect on financial statements, even in the absence of specific standards.

A is incorrect. Given the lag between new product development and regulatory action, the actions of standard setters and regulators are unlikely to be helpful when the new transactions initially arise.

C is incorrect. New types of transactions have unique elements that distinguish them from the transactions that arose previously. They may or may not affect the financial statements in the same way.