Lets have a look! Test. . The Framework from 2010 brought some structural changes to the qualitative charac- teristics of financial statements. Start studying FAR - 1.6 Qualitative Characteristics of Useful Financial Information. kelseybeattie_x. IAS 1 sets out the overall requirements for financial statements, including how they should be structured, the minimum requirements for their content and overriding concepts such as going concern, the accrual basis of accounting and the current/non-current distinction. The report has been prepared analysing the various factors such as the qualitative characteristics of financial statements as mentioned in the AASB accounting standards, discussion and description of two IASB / AASB accounting standards i.e. Financial statements should be relevant to the objectives of the enterprise. The financial statements should be presented in a simple and lucid way so as to make them easily understandable. The balances of different ledger accounts should be easily taken to these statements. You might never be able to calculate an exact dollar return from your human resources wellness and morale program spending, but qualitative projections can help you determine if the increases in productivity, efficiency, employee retention and morale are worth continuing that spending. No material information should be withheld while preparing these statements. The objective of financial statements is to provide information about the financial position, financial performance and cash flows of an entity that is useful to a wide range of users in making economic decisions. Financial statements are basically reports that depict financial and accounting information relating to businesses. This characteristic will enhance the utility of these statements. Quantitative characteristics refer to the calculation of financial transactions. These three core statements are intricately should not exclude any transaction. Those characteristics should be maximised both individually and in combination. Or browse via the menu above. Start studying Accounting Quantitative Characteristics of Financial Statements. SFFAC 1 also provides that information should be reliable, relevant, consistent, comparable, understandable and timely. Qualitative financial data will help you determine if activities you’re spending money on are worth the opportunity costs they incur. The Balance Sheet is a statement of assets and liabilities of the business on a particular date. So it is important that these statements must be prepared in such a way that is easy to understand and interpret for the shareholders. These customers are either first-time visitors who turn into long-term shoppers or regular customers who buy additional items once they are in the store. On the other hand, if figures are given in details then it will become difficult to judge the working of the business. IASB Framework for Presentation and Preparation of Financial Statements states FOUR principal characteristics as follows: Understandability; Relevance; Reliability; Comparability Comparability We will look at each qualitative characteristic in more detail below. The accounting also helps the businessman to know about his financial position. William Ackman: Everything You Need to Know About Finance and Investing in Under an Hour | Big Think - … Analyzing the quantitative and qualitative impacts of your activities using quantitative and qualitative financial data will help you make better management decisions. Fundamental qualitative characteristics are those whose absence makes financial information no longer useful. Easiness 6. A person who is not well versed with accounting terminology should also be able to understand the statements without much difficulty. The statement can also be compered with the figures of other concerns of the same nature. PLAY. Prohibited Content 3. Page 2 of 8 Relevance as a fundamental characteristic of financial statement is defined by Khan (2013) as the compilation of company’s financial dealing. In case of an internal or an external audit the information inside financial statements should be confirmable back to its original source. Faithful presentation. Brief 9. My video lectures about qualitative characteristics of conceptual framework such as completeness, comparability, consistency and verification are covered in my financial accounting, intermediate accounting and CPA lessons. The calculation work should be minimum possible while preparing these statements. Quantitative Characteristics of Financial Statements Quantitative financial data include numbers you can measure, such as revenue, expenses, profit margins and taxes. 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