This preview shows page 1. Sign up to view the full content.
Unformatted text preview: accounting information must be verifiable we must be able to prove that it is free of error. In addition, the information must be a faithful representation of what it purports to be it must be factual. Finally, accounting information must be neutral it cannot be selected, prepared, or presented to favor one set of interested users over another. In accounting, comparability results when different companies use the same accounting principles. At one level, U.S. accounting standards are comparable because they are based on certain basic principles and assumptions. These principles and assumptions allow for some variation in methods, however. To make comparison across companies easier, each company must disclose the accounting methods used. From the disclosures, the external user can determine whether the financial information is comparable and try to make adjustments....
View Full Document
This note was uploaded on 12/12/2011 for the course ACC 220 220 taught by Professor Aliciahubbard during the Winter '10 term at University of Phoenix.
- Winter '10