The qualitative characteristics should be arranged in terms of their relative importance. Data Analysis and Discussion of Findings This fiinding reveals that top management support, culture, ethical leadership, open communication channels, and ethics training are considered essential to improve the quality of fiinancial reporting. Verifiability means that different knowledgeable and independent observers could reach consensus, although not necessarily complete agreement, … two fundamental qualitative characteristics relevance and faithful representation; four enhancing qualitative characteristics: comparability, verifiability, timeliness and understandability. Applying the enhancing qualitative characteristics. Qualitative characteristics of financial statements Posted in: Accounting principles and concepts (explanations) There are mainly five types of financial statements ; statement of financial position, income statement , statement of changes in equity, statement of cash flows and disclosure notes. Enhancing qualitative characteristics improve usefulness of financial information. Enhancing qualitative characteristics. The information must be readily understandable to users of the financial statements. This means that information must be clearly presented, with additional information supplied in the supporting footnotes as needed to assist in clarification. The enhancing qualitative characteristics on the other hand include understandability, comparability, verifiability and timeliness). d. Qualitative characteristics measure the extent to which an entity has compiled with all relevant standards and interpretations. Enhancing qualitative characteristics should be maximized to the extent possible. However, the enhancing qualitative characteristics, either individually or as a group, cannot make information useful if that information is irrelevant or not faithfully represented. Relevance. However, neither do they compensate for lack of relevance or faithful presentation nor their absence make the information useless. Desirable trade-offs among them should be determined. Some environmental factors such as difficulty in measuring business events, limitations of available data, users’ diverse requirements, affect accounting and thus put constraint on achieving objectives. However, enhancing qualitative characteristics (either individually or collectively) cannot render information useful if that information is … The following are all qualitative characteristics of financial statements: Understandability. c. Qualitative characteristics are nonqualitative aspects of an entity's position and performance and changes in financial position. a: Qualitative characteristics a. Enhancing qualitative characteristics should be maximised to the extent necessary. Are considered either fundamental or enhancing b. They enhance the fundamental qualitative characteristics by distinguishing … The enhancing qualitative characteristics are verifiability, comparability, understandability and timeliness.

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