...accounting questions and answers / WhatIsMeantByComparabilityWhenDiscussingFinancialAccountingInformation?
Why was it believed that accounting standards that were issued by the FinancialAccounting Standards Board would carry more weight?
Financialinformation is anything that has to do with yourfinances. This may include money in the bank
Financialinformation is useful when it is relevant and represents faithfully what it purports to represent. The usefulness of financialinformation
Provide information about the reporting entity that is useful to present and equity investors. No Yes c. 8. Under Statement of FinancialAccounting
Comparability is the accounting principle that addresses the quality of accountinginformation and the usability of financial information. Information that is prepared using the same measurement techniques and reported in a similar fashion is considered comparable information.
Comparability of accountinginformation is also a very important characteristic because without it, deviations
34. Whatismeantbycomparabilitywhendiscussingfinancialaccountinginformation? a. Information has predictive or confirmatory value. b. Information is reasonably free from error. c. Information that is measured and reported in a similar fashion across companies.
Other Characteristics of AccountingInformation. Whenfinancial reports are generated by
Accountinginformation is measurable, quantifiable information about the transactions and events
Comparability Concept ensures that the financial statements of one accounting period are comparable to another so that users can derive
Comparability is the level of standardization of accountinginformationthat allows the financial statements of multiple organizations to be compared to each other. This is a fundamental requirement of financial reporting that is needed by the users of financial statements.
Accountinginformation qualitative characteristics are summarized below: In addition to the aforementioned characteristics (i.e., relevance, reliability, comparability, and consistency), the following qualities of accountinginformation affect its usefulness: understandability, materiality...
2 WhatAre the Benefits of International Accounting Standards? 3 International Financial Reporting Standards - Advantages & Disadvantages.
Home Accounting & Finance Fundamental FinancialAccounting Assumptions, Principles
10) Describe whatismeantby a reports involving the use of other auditors. Whatare the three options available to the principal auditor and when should each
Accountinginformationthat is reported to facilitate economic decisions should possess certain characteristics or normative standards. The informational qualities, which has been accepted by FASB (USA) in its Concept No. 2 “Qualitative Characteristics of AccountingInformation” is displayed in...
Comparability: Financial statements should enable users to compare the performances of companies, and the documents should follow the standards
It is very important that care must be taken when comparing results between two different companies in terms of products, size, market share etc.
Whenfinancial reports are generated by professional accountants, we have certain expectations of the information they present to us
Fiscal policy is the meansby which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy. It is the sister strategy to monetary policy through which a central bank influences a nation's money supply. Using a mix of monetary and fiscal policies, governments...
Accounting is the language of business. Accountants are responsible for organizing all financialinformation into meaningful sets of data that can be
chapter introduction to financialaccountingdiscussion questions whatis the basic purpose of
Three primary users of accountinginformation were previously identified, Internal users, External users, and Government/ IRS.
Itmeans that accounting collects financial information for the various users for taking decisions and tackling business issues.
By highest quality, we mean standards that provide users of financial statements with informationthat is clear, useful, and relevant to their needs, while
The information can be material by size, or nature. Prior Period Errors. It is defined as the omissions and misstatements in the financial
Financialaccounting is a branch of accounting that provides people outside the business—such as investors or loan officers—with qualitative information regarding an enterprise's economic resources, obligations, financial performance, and cash flow. Management accounting, on the other hand...
In financialaccounting, the rules are set by the FinancialAccounting Standards Board (FASB) or by the International Accounting Standards Board (IASB).
Information is also said to be relevant when it is capable of confirming or correcting the existing thought
INTERNATIONAL ACCOUNTING HARMONIZATION Preliminary “Harmonization” is a process for improving the compatibility (suitability)
Financialaccounting (or financialaccountancy) is the field of accounting concerned with the
Comparability is the quality of informationthat enables users to identify similarities in and differences between two sets of economic phenomena. Making decisions about one entity may be enhanced if comparableinformation is available about similar entities; for example...
More information about a Statement of Comparability can be found on the UK NARIC website .
Full Disclosure - all relevant accountinginformation must be disclosed to users 1) the “notes to the
Accounting cycle is concerned with informationthat will be used by both internal and external users. This meansthat management and members of the
Financialaccounting encompasses the rules and procedures to convey financial information about an
“Accounting is affected by its environment, including the culture of the country in which it operates.”
Definition of accounting concepts: Rules of accountingthat should be followed in preparation of all accounts and financial statements.
IAS 8 is applied in selecting and applying accounting policies, accounting for changes in estimates and reflecting corrections of prior period errors. The standard requires compliance with any specific IFRS applying to a transaction, event or condition, and provides guidance on developing accounting...
Comparability is enhanced by the use and disclosure of consistent accounting policies. Users can confirm that comparative information for calculating
FinancialAccounting I Meaning of Accounting:Accounting is the process of identifying,measuring,and communicating economic information to various users.
- the earnings process is judged to be complete or virtually complete(you do not owe the customer anything else) - there is reasonable certainty as to the collectibility of cash (you believe you will be paid) Comparability
I often get asked “whatis the difference between Finance and Accounting?”
While there are many definitions of accounting worldwide, provided by various accounting bodies
Accounting function is vital for every entity of the society whether individuals, house wives, business entity, nonprofit making organisations like municipalities
Financialaccounting is the preparation of financial statements that can be consumed by the public and
Whatisaccounting? Accounting is the recording, classifying, summarizing and interpreting of financial events and transactions to provide management and other interested parties the information they need to make better decisions.