Traditional Culture Encyclopedia - Traditional stories - What are the characteristics of quality of accounting information?
What are the characteristics of quality of accounting information?
According to the basic standards, the requirements for the quality of accounting information include reliability, relevance, understandability, comparability, substance over form, materiality, prudence and timeliness. (The first four are primary quality requirements, and the last four are secondary quality requirements)
1. Reliability. (Accounting recognition is based on transactions or events that actually occur.) Enterprises should be based on the actual occurrence of transactions or events for accounting recognition, measurement and reporting, faithfully reflecting the recognition and measurement requirements of the accounting elements and other relevant information to ensure that the accounting information is true and reliable, complete.
2. Relevance.
The accounting information provided by the enterprise should be relevant to the economic decisions of the users of the financial report (investors and creditors, the national macroeconomic management department, the internal management of the enterprise, and others) (e.g., which enterprise to buy shares), and help the users of the financial accounting report on the enterprise's past (e.g., whether it is operating at a loss), the present (e.g., how many resources the enterprise has to support the enterprise to participate in the market competition) or the future situation (e.g., how much resources the enterprise has to support the enterprise). (e.g., whether the enterprise can continue to survive), the present (e.g., how many resources the enterprise currently has to support the enterprise to compete in the market), or the future situation (e.g., whether the enterprise can continue to survive) to make an evaluation or forecast.
3. Understandability.
The accounting information provided by the enterprise should be clear and easy for users of financial reports to understand and use.
4. Comparability.
The same enterprise in different periods of the same or similar transactions or events, should be consistent accounting policies, not arbitrary changes. Do need to change, should be explained in the notes (vertically comparable).
5. Substance over form.
Substance over form, requires that enterprises should be in accordance with the economic substance of the transaction or event for accounting recognition, measurement and reporting, should not be based only on the legal form of the transaction or event.
6. Materiality.
Where the assets, liabilities, profits and losses have a greater impact on the important accounting matters, and thus affect the user to make reasonable judgments, must be dealt with in accordance with the prescribed accounting methods and procedures, and in the financial report to be separate and fully disclosed; such as the notes to the financial statements.
As for minor accounting matters, they may be appropriately consolidated and simplified, provided that they do not affect the truthfulness of the accounting information and do not mislead the users to make correct judgments.
7. Prudence.
Prudence, also known as soundness or prudence, means that an enterprise should exercise the necessary care in accounting, and should not over-account for assets or revenues, under-account for liabilities or expenses, but should not make secret provisions . (Judgment)
Requires accountants to exercise necessary caution when making professional judgments in the face of uncertainties, to fully estimate risks and losses, to do neither overestimate assets or revenues nor underestimate liabilities or expenses, and to reasonably account for expenses and losses that may be incurred. (eg: bad debt reserve for accounts receivable, quality "three packages", etc.)
8. Timeliness. Enterprises for transactions or events that have occurred, accounting recognition, measurement and reporting should be carried out in a timely manner, without advance or delay. (Judgment) timely collection, processing, preparation of financial reports, transmission of accounting information.
- Previous article:Corporate Culture of Alliance Chemical Industry
- Next article:What is the express delivery for sending documents to France?
- Related articles
- Cantonese Cuisine Recipe Names
- Songshan Shaolin School Address
- How about Foshan Gaoming Yin Xi Logistics?
- Where can I watch cartoons?
- How to choose a suitable hotel as a wedding venue?
- Is Thousand Hills in the National Collection?
- Refuse "fast food" reading, slow reading is a kind of cultivation.
- How much do you know about seaside cuisine?
- Seek the meaning of "ten virtues"?
- Where can I find a kettle and firewood in Harbin? The kettle cooked by the stove is bigger.