ACC 220 Week 3 DQ 1 - 7376

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ACC 220 Week 3 DQ 1
These qualitative accounting characteristics are key for financial reports in order to enable insiders and outsiders to trust the company and its performance, and enable correct financial decisions.
Reliability is the basement of further analysis. If reports are not reliable stakeholders are not able to know the exact point of situation, and furthermore allow verification.
Relevant: financial statements must show the company as it is, but also how it has get to that situation, and furthermore how it is going to perform in the future.
Consistent: financial reports must be prepared on a regular and similar basis. If criteria change from one report to another, comparison is difficult.
Comparable: Shareholders want to know if they could get a better return in other investments. In order to achieve this purpose, comparison must be guaranteed.

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ACC 220 Week 3 DQ 1
These qualitative accounting characteristics are key for financial reports in order to enable insiders and outs