Lo 4 identify the qualitative characteristics of

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LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Fundamental Quality—Relevance Information is material if omitting it or misstating it could influence decisions that users make on the basis of the reported financial information. LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Fundamental Quality—Faithful Representation Faithful representation means that the numbers and descriptions match what really existed or happened. LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Fundamental Quality—Faithful Representation Completeness means that all the information that is necessary for faithful representation is provided. LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Fundamental Quality—Faithful Representation Neutrality means that a company cannot select information to favor one set of interested parties over another. LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Fundamental Quality—Faithful Representation An information item that is free from error will be a more accurate (faithful) representation of a financial item. LO 4 Identify the qualitative characteristics of accounting information.
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Second Level: Qualitative Characteristics Enhancing Qualities LO 4 Identify the qualitative characteristics of accounting information. Information that is measured and reported in a similar manner for different companies is considered comparable .
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Second Level: Qualitative Characteristics Enhancing Qualities LO 4 Identify the qualitative characteristics of accounting information. Verifiability occurs when independent measurers, using the same methods, obtain similar results.
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Second Level: Qualitative Characteristics Enhancing Qualities LO 4 Identify the qualitative characteristics of accounting information. Timeliness means having information available to decision- makers before it loses its capacity to influence decisions.
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Second Level: Qualitative Characteristics Enhancing Qualities LO 4 Identify the qualitative characteristics of accounting information. Understandability is the quality of information that lets reasonably informed users see its significance.
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u Investment by owners u Distribution to owners u Comprehensive income u Revenue u Expenses u Gains u Losses Second Level: Basic Elements Concepts Statement No. 6 defines ten interrelated elements that relate to measuring the performance and financial status of a business enterprise. u Assets u Liabilities u Equity Moment in Time” Period of Time” LO 5 Define the basic elements of financial statements.
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Economic Entity – company keeps its activity separate from its owners and other businesses.
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