What are the four characteristics that enhance the quality of financial information?
The four characteristics that can enhance the quality of financial information are comparability, verifiability, timeliness, and understandability.
1) Comparability: Comparability enables financial statement readers the ability to compare differences and similarities with the financial reporting entity.
2) Verifiability: Verifiability enables financial statement readers to verify the accuracy of the information being reported based on outside parties’ ability to reach the same conclusion.
3) Timeliness: Timeliness enables financial statement readers to obtain information in time to have the ability to reach their decisions.
4) Understandability: Understandability enables financial statement readers to have the ability to characterize and classify various components of the financial statements that are being presented.
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