Accounting Information

the FASB specifies a hierarchy of desirable characteristics for accounting
information. Decision usefulness is paramount and to be useful information must be both
relevant and reliable.
While the statement provides numerous other desirable qualities in a
hierarchy, it clearly recognises that there will often be a conflict between two or more of
these characteristics. Thus at the highest level, relevant information may not be reliable while
reliable information may not be relevant. We will examine a similar attempt to specify desirable characteristics later in the chapter within the context of the UK ASB’s Statement of
Principles for Financial Reporting.