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Qualitative characteristic being employed when companies in the same industry are using the same accounting principles. |
comparability |
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Quality of information that confirms users’ earlier expectations. |
confirmatory value |
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Imperative for providing comparisons of a company from period to period. |
comparability (consistency) |
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Ignores the economic consequences of a standard or rule. |
Neutrality |
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Requires a high degree of consensus among individuals on a given measurement. |
verifiability |
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Predictive value is an ingredient of this primary quality of information |
relevance |
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Four qualitative characteristics that are related to both relevance and faithful representation |
comparability, timeliness, verifiability, understandability |
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An item is not recorded because its effect on income would not change a decision |
materiality |
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Neutrality is an ingredient of this primary quality of accounting information. |
faithful representation |
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Two primary qualities that make accounting information useful for decision-making purposes |
relevance, faithful representation |
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Issuance of interim reports is and example of what primary ingredient of relevance |
timeliness |
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