💦Assumption on Financial Reporting:
- Fair presentation
- Going concern
- Accrual Basic
- Materiality and aggregation
- No offsetting
- Frequency of reporting
- Consistency
- Comparative Information
💦Fundamental characteristics of useful information:
- Relevance (Information that can affect a decision and encompasses the notion of materiality)
- faithful Representation (complete, natural, free from error)
- Comparability
- Verifiability
- Timeliness
- Understandability
Finanancial Reporting quality: High-quality reporting provides decision-useful information, which is relevant and faithfully represents the economic reality of the company’s activities during the reporting period as well as the company’s financial condition at the end of the period which encompass the quality of earnings, cash flow, or balance sheet items.
The low-quality reporting provides information with pure fabrication (manipulation) event which impede assessment of earning quality.
The low-quality reporting provides information with pure fabrication (manipulation) event which impede assessment of earning quality.
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