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Completeness: underlines the basic idea Notably, due to human nature, mistakes
that, accounting information should do occur – it is something that cannot be
be considered as faithfully represented completely eradicated. As professional, it
if all pertinent information has been is advised to be careful and making sure
presented. When this is done as expected, that, one abides by the rules of conduct as
then it will be possible for one to make well as checking or examining the data and
FOR ONLINE READING ONLY
a complete and accurate assessment of figures used in process of preparing financial
business performance and its financial statements. This will ensure that, accounting
position. On the contrary, any omissions information is accurately portrayed
of relevant information, would lead to a and reported. It is also important to
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false or misleading depiction of business understand the key differences among the
activities and phenomena thus providing four enhancing qualitative characteristics.
incorrect picture of its performance as well Comparability: is the quality of accounting
as its financial position. As a result, this information to enable its users to identify
will render information useless to whoever similarities and differences between two sets
needs it to support business management of business phenomena. It is important that,
or any kind of decisions. similar situations should be presented in

Neutrality: underscores the basic idea that, the same manner while different situations
accounting information should be neutral, should be presented differently. Moreover,
or free from any bias. To achieve this, it there is a need to observe consistency, which
is strongly forbidden to alter or present includes, the use of the same accounting
accounting information in any way that is policies and procedures from one accounting
meant to influence a decision to be made with period to another within the businesses and
a predetermined result in mind. The logic the industry. This will facilitate the ability of
and justification for this; it will do good users of accounting information to compare
for society and accounting profession when the financial statements of the business over
the overall societal goals and accounting time as well as with other similar businesses
guidelines are adhered to, rather than the within the industry.
desires of any one person or group of Verifiability: underscores the basic idea that,
people, with their own agendas. for accounting information to be considered
Free from material error: stresses the need as true or correct, it should be possible for one
or desire to keep accounting information free to prove/confirm whether it is true/correct.
from error. This can be achieved by ensuring For example, during the audit assignment,
that, there are no errors and inaccuracies an auditor can cross check with the bank to
in the description of the phenomenon and see whether the bank account balance of
no errors are made during the different the business being audited is the same as
processes of preparing financial statements. that shown in its balance sheet (That is.,

Student’s Book Form Five
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10

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ACCOUNTANCY_DUMMY_23 JUNE.indd 10
ACCOUNTANCY_DUMMY_23 JUNE.indd 10 23/06/2024 17:34