What are the qualitative characteristics of financial information?

The qualitative characteristics of financial information refer to the attributes that make financial information useful and valuable for decision-making. These characteristics include relevance, reliability, comparability, and understandability. Relevance refers to the ability of financial information to influence the decisions of its users by providing useful and timely information. Reliability refers to the accuracy, completeness, and unbiased representation of financial information. Comparability ensures that financial information can be compared over time or between different entities to identify trends or similarities. Lastly, understandability refers to the clarity and comprehensibility of financial information for its intended users, ensuring that it is accessible and can be interpreted accurately. These qualitative characteristics are vital to ensure the credibility and usefulness of financial information in various business and economic contexts.

This mind map was published on 3 September 2023 and has been viewed 102 times.