Acca financial Accounting (FA) Study Text ac ca (FA)

Enhancing qualitative characteristics 

 

Comparability, verifiability, timeliness and understandability are 

qualitative characteristics that enhance the usefulness of information that 

is relevant and faithfully represented. 

Comparability 

Users must be able to: 

•

 

compare the financial statements of an entity over time to identify 

trends in its financial performance and financial position 

•

 

compare the financial statements of different entities to evaluate 

their relative financial performance and financial position. 

For this to be the case there must be: 

•

 consistency 

and 

•

 disclosure. 

An important implication of comparability is that users are informed of the 

accounting policies employed in preparation of the financial statements, 

any changes in those policies and the effects of such changes. 

Compliance with accounting standards, including the disclosure of the 

accounting policies used by the entity, helps to achieve comparability. 

Because users wish to compare the financial position and the 

performance and changes in the financial position of an entity over time, 

it is important that the financial statements show corresponding 

information for the preceding periods. 

 

 

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