You are a senior accountant of Ramona Enterprises Limited. What three steps would you take to make your company's financial statements understandable and decision useful?
[Hint : Refer to qualitative characteristics of accounting information]
Dear Student,
1. Reliability, i.e. Verifiability, Faithfulness, Neutrality:
1. Reliability, i.e. Verifiability, Faithfulness, Neutrality:
The financial statements would be made trustable and unbiased and without any errors so that they could be verified.
2. Relevance, i.e. Timeliness:
The financial statements would be completed on time without any delay.
The financial statements would be completed on time without any delay.
3. Understandability and Comparability:
The financial statements would be in such a manner that they'd be easily understood and could be compared to other firm's statements or the previous years' statements of the firm itself.
Regards
The financial statements would be in such a manner that they'd be easily understood and could be compared to other firm's statements or the previous years' statements of the firm itself.
Regards