Enumerate the characteristics of accounting information, Financial Accounting

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Enumerate the characteristics of accounting information

Qualities, or characteristics, which have just been depicted would help us to decide whether accounting information is potentially useful. If a specific piece of information has these qualities then it may be useful. Though, this doesn't automatically mean that it must be reported to users. We also have to determine whether information is material, or significant. This means that we must ask whether its misrepresentation or omission in the accounting reports would really alter the decisions which users make. Hence, in addition to possessing characteristics mentioned above, accounting information should also cross the threshold of materiality. If information isn't regarded as material, it must not be included within the reports as it would simply clutter them up and, possibly, interfere with the users' ability to interpret financial results. Type of information and amounts involved will generally conclude whether it is material.

 


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