Special purpose framework definition

What is a Special Purpose Framework?

A special purpose framework is a non- GAAP financial reporting framework that employs either a cash, tax, regulatory, contractual, or other basis of accounting. For example, a tax basis of accounting is used to file an organization’s tax return for the period covered by its financial statements . Or, a regulatory basis of accounting is intended to force the reporting entity to comply with the requirements of a specific regulatory agency. These frameworks are designed for a more specialized audience than one of the general-purpose frameworks, such as generally accepted accounting principles (GAAP).

The nature of a special purpose framework can alter the content and format of an entity's financial statements and accompanying disclosures . The type of special purpose framework should be stated in the compilation , review , or audit report that an auditor issues; additional disclosures may be needed.