Explore BrainMass

Explore BrainMass

    Financial Accounting

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Please discuss the quality control standards and practices within the accounting profession. How are these standards and practices applied? Please use examples in your discussion.

    © BrainMass Inc. brainmass.com June 3, 2020, 8:05 pm ad1c9bdddf

    Solution Preview

    The Financial Accounting Standards Board (FASB) sets accounting principles for the profession.

    Fundamental qualities of accounting financial statements:
    * Relevant
    Relevant information makes a difference in a decision. It also helps users make predictions about past, present and future events (it has predictive value). Relevant information helps users confirm or correct prior expectations (it has feedback value). It must also be available on time, that is before decisions are made.

    * Reliable
    Reliable information is verifiable (when independent auditors using the same methods get similar results), neutral (free from bias), and demonstrate representational faithfulness (what really happened or existed).

    * Comparable
    Information must be measured and reported in a similar manner for different enterprises (allows financial statements to be compared between different companies).

    * Consistent
    The same accounting methods should be applied from period to period and all changes in methods should be well explained and justified.

    To achieve basic objectives and implement ...

    Solution Summary

    The quality control standards and practices within the accounting profession are discussed.