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Define some of the major characteristics of accounting. Why is accounting important to the non-accountant?

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Define some of the major characteristics of accounting? Why is accounting important to the non-accountant?

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Key Characteristics of Accounting:

Understandability

This implies the expression, with clarity, of accounting information in such a way that it will be understandable to users - who are generally assumed to have a reasonable knowledge of business and economic activities

Relevance

This implies that, to be useful, accounting information must assist a user to form, confirm or maybe revise a view - usually in the context of making a decision (e.g. should I invest, should I lend money to this business? Should I work for this business?)

Consistency

This implies consistent treatment of similar items and application of accounting policies

Comparability

This implies the ability for users to be able to compare similar ...

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