# ASC 274-10-05: Personal Financial Statements — Overall — 05 Overview and Background

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/274/10/#05-overview-and-background)

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## ASC 274-10-05: 05 Overview and Background

[Read section](https://asc.understandingaccounting.org/asc/274/10/#05-overview-and-background)

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##### [274-10-05-1](https://asc.understandingaccounting.org/asc/274/10/#274-10-05-1)

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This Subtopic addresses personal financial statements. Personal financial statements are prepared for individuals either to formally organize and plan their financial affairs in general or for specific purposes, such as obtaining of credit, income tax planning, retirement planning, gift and estate planning, or public disclosure of their financial affairs. Users of personal financial statements rely on them in determining whether to grant credit, in assessing the financial activities of individuals, in assessing the financial affairs of public officials and candidates for public office, and for similar purposes.

#### Basis of Presentation of Personal Financial Statements

##### [274-10-05-2](https://asc.understandingaccounting.org/asc/274/10/#274-10-05-2)

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The primary focus of personal financial statements is a person's assets and liabilities, and the primary users of personal financial statements normally consider [estimated current value](https://asc.understandingaccounting.org/glossary/e/#estimated-current-value "For an asset, the amount at which the item could be exchanged between a buyer and seller, each of whom is well informed and willing, and neither of whom is compelled to buy or sell.") information to be more relevant for their decisions than historical cost information. Lenders require estimated current value information to assess collateral, and most personal loan applications require estimated current value information. Estimated current values are required for estate, gift, and income tax planning, and estimated current value information about assets is often required in federal and state filings of candidates for public office.

##### [274-10-05-3](https://asc.understandingaccounting.org/asc/274/10/#274-10-05-3)

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This Subtopic provides guidance on how the estimated current values of assets and the estimated current amounts of liabilities are determined and applied in the preparation and presentation of personal financial statements.