Qualitative Characteristics Of Financial Reporting

A Financial Statement is a document narration business monetary performance and resources. It shows how a firm has utilize the funds entrusted to it by its stockholders, sh atomic number 18holders and lenders, and what is its current monetary position. The three basic pecuniary statements atomic number 18 the balance sheet, which shows firms assets, liabilities, and owners beauteousness or hold earnings on a say date; the income statement, in like manner called profit & dismission account, which shows the sales and expenses of a business everywhere a tip of time, and cash flow statement, which shows the inflows and outflows of cash caused by the firms activities during a stated period. Financial statements be usually compiled on a quarterly and annual basis. Qualitative characteristics of Financial Statement The soft characteristics of fiscal statements are a set of attributes which together imbibe the nurture in the financial statements utile to the users. The qualitative characteristics of usable financial reporting identify the types of tuition are promising to be most reusable to users in making decisions astir(predicate) the reporting entity on the basis of information in its financial report. The qualitative characteristics utilize equally to financial information in general propose financial reports as well as to financial information provided in other ways.

The four lead-in qualitative characteristics are understandability, relevance, reliability and comparability. Financial information is useful when it is relevant and represents dependably what it purports to represent. The usefulness of financial information is compound if it is comparable, verifiable, timely and ! understandable. relevancy and faithful re institution are the essential qualitative characteristics of useful financial information. The four main leash qualitative characteristics are understandability, relevance, reliability and comparability. Understandability and comparability are both presentation issues within a...If you want to get a full essay, redact it on our website: OrderEssay.net

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