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-Relevance - Accounting information is relevant if it is capable of making a difference in a decision.
Relevant information has:
(a) Predictive value
(b) Feedback value
(c) Timeliness
- Reliability - Accounting information is reliable to the extent that users can depend on it to represent the economic conditions or events that it purports to represent.
Reliable information has:
(a) Verifiability
(b) Representational faithfulness
(c) Neutrality
2) Secondary qualities of useful accounting information:
Comparability - Accounting information that has been measured and reported in a similar manner for different enterprises is considered comparable.
Consistency - Accounting information is consistent when an entity applies the same accounting treatment to similar accountable events from period to period.
Accounting Qualities and Useful Information for Analysts
Here is how these qualities provide analysts with useful information:
Relevance- Relevant information is crucial in making the correct investment decision.
Reliability - If the information is not reliable, then no investor can rely on it to make an investment decision.
Comparability - Comparability is a pervasive problem in financial analysis even though there have been great strides made over the years to bridge the gap.
Consistency - Accounting changes hinder the comparison of operation results between periods as the accounting used to measure those results differ.
What else can I help you with?
What body has defined the purpose of financial accounting and reporting?
The basic foundation of governmental financial accounting and reporting in the United States was established by the Governmental Accounting Standards Boards (GASB) in its "Objectives of Financial Reporting,"
Objectives of management reporting?
objectives or purpose of management reporting
Which of the financial accounting objectives listed below would seem to be closest to the objective of tax reporting?
The financial accounting objective that seems closest to the objective of tax reporting is the objective of providing information to investors and creditors. Both financial accounting and tax reporting aim to accurately report financial information to stakeholders, whether they are investors, creditors, or government agencies. While financial accounting focuses on providing information for decision-making and assessing the financial health of a company, tax reporting is focused on ensuring compliance with tax laws and regulations. Both processes involve reporting financial information in a transparent and accurate manner to different parties.
How does GAAP affect financial reporting?
How does GAAP affect financial reporting?
Who is responsible for establishing and maintaining internal controls to achieve the objectives of effective and efficient operations reliable financial reporting and compliance with applicable laws?
Managers
What body has defined the purpose of financial accounting and reporting?
The basic foundation of governmental financial accounting and reporting in the United States was established by the Governmental Accounting Standards Boards (GASB) in its "Objectives of Financial Reporting,"
Objectives of management reporting?
objectives or purpose of management reporting
What are the objectives of financial reporting for business enterprises based on the FASB conceptual framework?
the needs of the users of the information.
What is the objective of financial reporting?
The key financial reporting objectives outlined in the conceptual framework are as follows: -Usefulness -Understandability -Target audience:investors and creditors -Assessing future cash flows -Evaluating economic resourses -Primary focus on earings
Three internal control objectives for financial reporting?
There are actually four internal control objectives of financial reporting. They are 1) Control Environment 2) Risk Assessment 3) Information and Communication Systems 4) Monitoring. These internal control objectives help aid in presenting financial statements that are free of material misstatements. But just because internal control measures are implemented, doesn't mean people cannot circumvent those controls.
Which of the financial accounting objectives listed below would seem to be closest to the objective of tax reporting?
The financial accounting objective that seems closest to the objective of tax reporting is the objective of providing information to investors and creditors. Both financial accounting and tax reporting aim to accurately report financial information to stakeholders, whether they are investors, creditors, or government agencies. While financial accounting focuses on providing information for decision-making and assessing the financial health of a company, tax reporting is focused on ensuring compliance with tax laws and regulations. Both processes involve reporting financial information in a transparent and accurate manner to different parties.
What is the differences between decision usefulness and accountability objectives of general purpose financial reporting?
Accountability is the classical view on financial reports meaning u should report as close to real world as possible. Decission usefullness is about reporting as what should be best for decissionmakers(investors)
How does GAAP affect financial reporting?
How does GAAP affect financial reporting?
Who is responsible for establishing and maintaining internal controls to achieve the objectives of effective and efficient operations reliable financial reporting and compliance with applicable laws?
Managers
When was Financial Reporting Council created?
Financial Reporting Council was created in 1990.
Do financial reporting and financial statement mean the same thing?
"Do the term financial reporting and financial statement mean the same thing?"
What determines fair financial reporting?
But in the end, fair financial reporting depends on the integrity of the company's financial team.
