What is most important quality for accounting information

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The Financial Accounting Standards Board has developed a conceptual framework for financial accounting and reporting. The FASB has issued seven Statements of Financial Accounting Concepts.

These statements set forth objectives and fundamentals that will be the basis for developing financial accounting and reporting standards. The objectives identify the goals and purposes of financial reporting. The fundamentals are the underlying concepts of financial accounting concepts that guide the selection of transactions, events, and circumstances to be accounted for; their recognition and measurement; and the means of summarizing and communicating them to interested parties.

The purpose of Statement of Financial Accounting Concepts No. 2, "Qualitative Characteristics of Accounting Information," is to examine the characteristics that make accounting information useful. The characteristics or qualities of information discussed in Concepts No. 2 are the ingredients that make information useful and are the qualities to be sought when accounting choices are made.

What is the most important quality for accounting information as identified in Statement of Financial Accounting Concepts No. 2? Explain why it is the most important.

Reference no: EM13134614

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