Qualitative Characteristics

Question 1

Timeliness

Answer 1

Financial information should be available to decision makers in time to be capable of influencing their decisions

Question 2

Relevance

Answer 2

Financial information must be capable of making a difference to the decisions made by users by helping to form predictions and/or confirm or change their previous evaluations

Question 3

Understandability

Answer 3

Financial information should be understandable or comprehensible to users with a reasonable knowledge of business and economic activities and presented clearly and concisely

Question 4

Verifiability

Answer 4

Ensures that different, knowledgeable and independent observers can reach the same conclusion that a particular representation of an event is faithfully represented

Question 4

Verifiability

Answer 4

Ensures that different, knowledgeable and independent observers can reach the same conclusion that a particular representation of an event is faithfully represented

Question 5

Faithful Representation

Answer 5

The financial information reported is a faithful representation of the real-world economic event it claims to represent: complete, free from material error and neutral (without bias)

Question 6

Comparability

Answer 6

Useful information is provided when the financial reports of a business can be compared over time and compared with similar information of other businesses