A conceptual framework is frequently a guideline that explains why a project is carried out in a specific manner. A conceptual framework, in a nutshell, may be defined as a representation or effort to characterize the nature and persistence of accounting (Hussey, 2010). The conceptual framework outlines what will be included in the analysis of a given issue or problem within the broader context of accounting principles. Conceptual frameworks are used by accountants when performing audits. They help identify important information about an entity's activities that may not be apparent from merely reading its financial statements. These statements are supplemented by various other documents, such as management's discussion and analysis (MD&A) sections of annual reports and quarterly reports filed with the Securities and Exchange Commission (SEC). The conceptual framework identifies issues requiring further investigation or explanation before an audit can be completed. For example, if an auditor suspects that a company is misclassifying revenue, he or she would first determine which items should be classified as revenue by reviewing the company's conceptual framework. Only after determining which items should be considered revenue would the auditor look at the specific transactions involved (e.g., sales contracts). Without first establishing which items should be classified as revenue, the auditor would not be able to evaluate whether the company was correctly classifying its transactions. In addition to audits, conceptual frameworks are useful for preparing presentations on certain topics within the broader context of accounting principles.