Consider any indicative sentence where our main concern is to know whether we can apprehend the thought from the indicative sentence or not and then we can ask if we apprehend, is it possible for us to investigate the fact what it states about? This becomes the concern of the second function. After having the appropriate investigation still we cannot claim that the sentence is either true or false. It is so because there are certain cases where it fails. For example, by seeing a flash of light we are saying that thunder is approaching but it may not be the case. So, we need the assertion which might be projected as in the form of asserting judgment. Combining all these three functions we then claim that any indicative sentence is either true or false. This is because it fulfills all the criteria of the truth condition of a proposition.

Since every sentence is endowed with thought, it possesses meaning. By the help of meaning we refer to the object that it stands for. So, from sense we are proceeding towards reference. Reference is of two sorts.

1. direct reference
2. indirect reference

In direct reference, the referent is known without any medium. In this case, we know the meaning of a word or the sense of an expression then refer to the particular object that it stands for, whereas in case of indirect reference, we frame an image which we had seen or experienced earlier, then refer to the object on the basis of that image. Frege calls indirect reference "customary sense". Indirect reference of a sentence is due to the concept which maps thoughts. So, we are able to get the truth-value of all the sentences which are having indirect references. A question is raised here, how do we know that anything whatsoever has a reference? Frege answers that when we say the word 'tree', we do not intend to speak of our idea of the tree nor are we satisfied with the sense alone. Thus, we need the reference of it.

There may be cases where we understand a sentence without grasping the thought of that sentence. We grasp the thought of a sentence only when we know the meaning of the constituent parts of that sentence and their application towards the object of the phenomenal world. Hence, we know its reference. Therefore, we know its truth-value, i.e., circumstances under which the sentence will be treated as true or false.

It is quite clear that someone might well understand either sentence, without understanding the other. And this means that we need to make a clear distinction between, on the one hand, grasping a certain thought (or concept) and, on the other hand, understanding a given sentence (or concept word). It means in fact that we have to make a clear distinction between the content of a given thought, and the sense of a particular sentence (Bell, 1996, 594).