QC & AP Quiz

1. Qualitative Characteristics &
Accounting Principles

2. QUALITATIVE CHARACTISTICS
ACCOUNTING PRINICPLES

3. QUALITATIVE CHARACTERISTICS
(CURR)
• Comparability
• Understandability
• Relevance
• Reliability
Back

4. COMPARABILITY
Reports should be able to compared over time
through the use of consistent accounting
procedures
Back

5. UNDERSTANDABILITY
Reports should be presented in a manner that
makes it easy for the user to comprehended
their meaning.
Back

6. RELEVANCE
Reports should include all information which is
useful for decision-making
Back

7. RELIABILITY
Reports should contain information verified by
source document evidence so that it is free
from bias
Back

8. ACCOUNTING PRINCIPLES
• Entity Principle
• Going concern principle
• Reporting period principle
• Historical Cost principle
• Consistency principle
• Conservatism principle
• Monetary principle
Back

9. ENTITY PRINCIPLE
The business is separate from the owner and
other entities, and its records should be kept
on this bias
Back

10. Going concern principle
The life of the business is assumed to be
continuous, and its records are kept on that
basis
Back

11. Reporting period principle
The life of the business must be divided into
‘periods’ of time to allow reports to be
prepared, and the accounting records should
reflect the reporting period in which a
transaction occurs
Back

12. Historical Cost principle
Transactions should be recorded at their original
purchase price, as this value is verifiable by
source documents evidence.
Back

13. Consistency Principle
the business should use the same accounting
methods to allow for the comparison of
reports from one period to the next
Back

14. Conservatism Principle
Losses should be recorded when probable, but
gains only when certain so that liabilities and
expenses are not understated and assets and
revenues are not overstated
Back

15. Monetary Principle
All items must be recorded and reported in the
currency of the country of location where the
reports are being prepared
Back