Question

explain the 7 characteristics (attributes) of account​

Answer 1

Explanation:

 neutrality, timeliness, economic realism) make financial reporting information useful to users. These normative qualities of information are based largely upon the common needs of users.

However, there are three constraints on full achievement of the qualitative characteristics:

(i) Conflict of objectives,

(ii) Environmental influences, and

(iii) Lack of complete understanding of the objectives.

The pursuit of one characteristic may work against the other characteristics. It is difficult to design financial reports which may be relevant to user needs on the one hand and also free from bias towards any particular user group on the other. The qualitative characteristics should be arranged in terms of their relative importance.

Desirable trade-offs among them should be determined. Some environmental factors such as difficulty in measuring business events, limitations of available data, users’ diverse requirements, affect accounting and thus put constraint on achieving objectives. Constraints also arise because users have different level of competence to handle large masses of data or to interpret summarised data in making predictions.

Many attempts have been made to examine the relative significance of (or possible conflict among) these qualitative characteristics. As stated earlier FASB Concept No. 2 (Qualitative Characteristics of Accounting Information May 1980) recognises relevance and reliability as primary qualitative characteristics and other remaining characteristics as ingredients of these primary qualities.

Answer 2

Answer:

1. Relevance.

2. Consistency

3. Comparability.

4. Reliability.

5. Objectivity.

6. Materiality

7. Neutrality.

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