Developing the system of qualitative characteristics of financial information

2017 ◽  
Vol 20 (18) ◽  
pp. 1051-1065 ◽  
Author(s):  
Z.I. Kruglyak ◽  
◽  
O.I. Shvyreva ◽  
Keyword(s):  
Financial Information ◽  
Qualitative Characteristics

XBRL and the qualitative characteristics of useful financial information

2017 ◽  
Vol 30 (01) ◽  
pp. 107-126 ◽  
Author(s):  
Jacqueline L. Birt ◽  
Kala Muthusamy ◽  
Poonam Bir
Keyword(s):  
Financial Reporting ◽  
Experimental Approach ◽  
Financial Information ◽  
Financial Reports ◽  
Standard Format ◽  
Distant Future ◽  
Content Type ◽  
The Usa ◽  
The Uk ◽  
Qualitative Characteristics

Purpose eXtensible Business Reporting Language (XBRL) is an internet-based interactive form of reporting language that is expected to enhance the usefulness of financial reporting (Yuan and Wang, 2009). In the UK and the USA, XBRL is mandatory, and in Australia, it is voluntarily adopted. It has been reported that in the not too distant future, XBRL will be the standard format for the preparation and exchange of business reports (Gettler, 2015). Using an experimental approach, this study assesses the usefulness of financial reports with XBRL tagged information compared to PDF format information for non-professional investors. The authors investigate participants’ perceptions of usefulness in relation to the qualitative characteristics of relevance, understandability and comparability. Design/methodology/approach This paper uses an experimental approach featuring a profit-forecasting task to determine if participants perceive XBRL-tagged information to be more useful compared to PDF-formatted information. Findings Results reveal that financial information presented with XBRL tagging is significantly more relevant, understandable and comparable to non-professional investors. Originality/value The authors address a gap in the literature by examining XBRL usefulness in Australia where XBRL adoption will be mandated within the not too distant future. Currently, the voluntary adoption of XBRL by preparers and users is low, possibly, because of a lack of awareness about XBRL and its potential benefits. This study yields significant implications for the accounting regulators in creating more awareness on the benefits of using XBRL and to create an impetus for XBRL adoption.

scholarly journals Qualitative Characteristics of Financial Reporting: An Evaluation According to the Albanian Users’ Perception

2021 ◽  
Vol 10 (6) ◽  
pp. 35
Author(s):  
Albana Gjoni-Karameta ◽  
Elona Fejzaj ◽  
Ahmad Mlouk ◽  
Kristina Sila
Keyword(s):  
Financial Reporting ◽  
Continuous Process ◽  
Accounting Standards ◽  
Financial Statements ◽  
Financial Information ◽  
Faithful Representation ◽  
Strong Positive Correlation ◽  
Opinion Survey ◽  
Positive Correlation ◽  
Qualitative Characteristics

The last 20 years’ changes in accounting has led to an essential review process of national accounting standards due to the main objective of improving financial reporting information for stakeholders. Financial reporting as a communication tool has become extremely important for appropriate decision making to economic reporting entities and also financial information users such as analysts, creditors, managers, auditors and government agencies in Albania and all over the world. The absence of a generally accepted definition for qualitative financial reporting has created a gap for continuous research on this matter. The main objective of this study is to examine users’ perception of qualitative financial reporting, toward their perceptions of some selected qualitative characteristics of financial statements. This study aims to determine the attitudes of financial statements’ users toward the importance of qualitative characteristics of financial information reported on these published financial statements. The chosen   qualitative characteristics were relevance, faithful representation, comparability, timeliness, verifiability and understandability. An opinion survey was conducted on three hundred external users of financial statements, such as managers, bank officers, financial analysts, government officers and auditors. Each single characteristic has been operationalized using a structured questionnaire, and a five point Likert type scale was used. Selection process of qualitative characteristics of reported financial information will be based on the data taken from conceptual framework of international financial reporting standards published by the International Accounting Standards Board in a continuous process of improving financial reporting. This research examined primary data taken through an opinion survey directed to three hundred daily users of financial statements ‘information, reported by economic entities in Albania. Results of the study show a very strong positive correlation between users ‘perception and qualitative characteristic of faithful representation, a relatively strong positive correlation with relevance, comparability and understandability, and a moderate correlation with timeliness and verifiability. Users of financial reporting in Albania generally have a very positive attitude towards the qualitative characteristics of financial reporting.   Received: 3 July 2021 / Accepted: 23 August 2021 / Published: 5 November 2021

scholarly journals Quality of financial reporting: approaches to measuring

2015 ◽  
Vol 4 (1) ◽  
pp. 1 ◽  
Author(s):  
Jurij Renkas ◽  
Olena Goncharenko ◽  
Olena Lukianets
Keyword(s):  
Soviet Union ◽  
Financial Reporting ◽  
Former Soviet Union ◽  
Information Needs ◽  
Information Quality ◽  
Reporting Quality ◽  
Financial Statements ◽  
Financial Information ◽  
Qualitative Characteristics

<p>Financial reporting must meet many criteria to be considered high quality because it is the quality of information that determines the viability of future strategic decisions. The article investigates the essence of the concept of "quality" and "quality of financial infor-mation", and defines indicators and criteria of the financial reporting quality. As for the quality of the financial reporting, it is found that the latter is a structured reflection of financial condition and financial results of the entity, therefore, can be regarded as a set of components: quality of the financial information; quality of presentation of the financial information. It was found that the quality of the reporting of financial information is evaluated using a system of indicators that are qualified by the Financial reporting framework as the qualitative characteristics of useful financial information and National Accounting Statement (standard) 1 as the qualitative characteristics of financial reporting. In terms of formalization (presentation within the legislation forms) of the financial information presentation in Ukraine, we can speak of quality only in respect of the notes to the financial statements. It has been established that quality assessment indicators of presenting the financial information in the notes may be: readability of the information, visualization of the representation. Research of the quality requirements for the financial statements (information) of the participating countries of the former Soviet Union has identified many variations, but the most commonly used features are relevance, reliability, comparability and understandability. It is indicated that most post-Soviet countries, including Ukraine, gradually bring its legislation on the regulation of financial statements in conformity with IFRS. But there are still many unresolved differences, chief among which are the qualitative characteristics of the financial statements that should provide the information needs of different user groups.</p>

scholarly journals UNDERSTANDING EXPECTATION GAP IN TERMS OF CONCEPTUAL FRAMEWORK FOR FINANCIAL REPORTING

InterConf ◽  
2021 ◽  
pp. 39-45
Author(s):  
Farida Sadigova
Keyword(s):  
Statistical Analysis ◽  
Conceptual Framework ◽  
Financial Reporting ◽  
Financial Information ◽  
Sufficient Knowledge ◽  
Economic Decisions ◽  
Expectation Gap ◽  
User Groups ◽  
The Given ◽  
Qualitative Characteristics

The main purpose of financial reporting is to provide information to user groups, such as providers of finance, investors, shareholders, and others, that will be useful for them in making economic decisions. Expectation gap has been known as one of the major topics for debate in accountancy, so this paper aims to find out whether such gap exists in terms of perception of the importance of the financial information qualitative characteristics (defined in Conceptual Framework) from the perspectives of two groups (auditors and public) involved in working with and using such information. To achieve the purpose of the given paper, a survey was conducted, the results of which were used in the statistical analysis which is shown in the next sections of the paper. The survey was responded by 32 auditors and 38 representatives of public with sufficient knowledge in finance and accounting. Results of the statistical analysis show that there is some difference between auditors and public in terms of the importance perception of several elements from the financial information qualitative characteristics.

scholarly journals Editorial 63 (2) Especial Contabilidad

2018 ◽  
Vol 63 (2) ◽  
pp. 26
Author(s):  
Ilidio Tomás Lopes ◽  
Paula Odete Fernandes
Keyword(s):  
Decision Making ◽  
Financial Reporting ◽  
Primary Source ◽  
Theory And Practice ◽  
Financial Information ◽  
Special Issue ◽  
Future Directions ◽  
Qualitative Characteristics ◽  
Scientific Fields

<p><em>Accounting</em> is in its essence, the language of businesses and the summary of economic events for the purpose of providing financial information for decision making. It is materialized on the firms’ financial statements, periodically disseminated to a wide diversity of stakeholders, and used as a primary source of financial perceptions and beliefs. As a reflection of businesses’ dynamics, financial information should be useful by observing the fundamental qualitative characteristics -relevance and faithful representation- and the enhancing qualitative characteristics -comparability, verifiability, timeliness, and understandability-. This special issue, on the scope of <em>Accounting</em> and other related scientific fields, such as <em>Auditing</em> and <em>Taxation</em>, was driven by the importance of the financial reporting on the entire decision-making process, and by the role of some Corporate Governance agents, as granters and controllers of information reliability and transparency. The current issue, strongly focused on those scientific fields, can certainly serve as a contribution for theory and practice, underlining some of the old and current paradoxes, and driving readers into future directions and challenges.</p><p>The organization of a special issue is always an interesting challenge. It is based on the desire to capture and integrate in the special issue the best and the latest developments occurred in a particular scientific field. Indeed, it is our conviction that we have clearly achieved that goal by providing readers with a set of original and useful papers.</p>

scholarly journals Qualitative characteristics of company annual reports as perceived by constituencies in the reporting environment

1985 ◽  
Vol 16 (3) ◽  
pp. 119-124 ◽  
Author(s):  
D. K. Flynn
Keyword(s):  
Annual Report ◽  
Listed Company ◽  
Financial Analysts ◽  
Statistical Test ◽  
Financial Information ◽  
Annual Reports ◽  
Reporting Environment ◽  
Qualitative Characteristics

In this article a list of qualitative characteristics which investors and analysts are likely to require from the annual report of a listed company is identified. The research analyses data obtained from a questionnaire in an effort to determine which qualitative characteristics are most important to investors and financial analysts. It is attempted to determine whether a more parsimonious list can be constructed. Finally, a statistical test is performed in order to establish whether preparers and regulators of financial information perceive the qualitative characteristics deemed important by investors and analysts correctly.In hierdie artikel word 'n lys van kwalitatiewe eienskappe wat beleggers en finansiele analiseerders moontlik van die jaarverslag van 'n gekwoteerde maatskappy kan verwag, geidentifiseer. Die navorsing analiseer data verkry van 'n vraelys in 'n poging om te bepaal watter kwalitatiewe eienskappe die mees belangrikste vir beleggers en analiseerders is. Daar word verder gepoog om vas te stel of 'n korter lys opgestel kan word. Laastens word 'n statistiese toets uitgevoer om te bepaal of die voorbereiders en reguleerders van finansiele inligting die kwalitatiewe eienskappe wat beleggers en analiseerders belangrik ag, korrek waarneem.

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