Faithful presentation is one on the two primary fundamental qualitative characteristics for financial information to be useful as proposed in the Exposure Draft released as part of the joint initiative of the IASB and US FASB.A financial report is faithfully presented if it is:
A)consistent,free from bias and free of material error.
B)accurate,free from bias and free of material error.
C)complete,neutral and free of material error.
D)reliable,neutral and free of material error.
E)None of the given answers.

Question

Quizplus · Accepted Answer

The concept of faithful presentation is a fundamental qualitative characteristic of financial reporting, as outlined by the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) in their conceptual frameworks. Faithful presentation means that the financial reports accurately reflect the economic phenomena they purport to represent. This allows users of the financial statements to rely on them with confidence.
According to the frameworks, a financial report is faithfully presented if it is:
3. complete, neutral, and free of material error.
This means that the financial information must include all the necessary data for a user to understand the economic event being reported (complete), it must not be biased towards achieving a predetermined result or influencing users' behavior in a certain way (neutral), and it must not contain mistakes or omissions that could influence the economic decisions of users (free of material error).
Therefore, the correct answer to the question is:
3. complete, neutral, and free of material error.

Faithful Presentation Is One on the Two Primary Fundamental Qualitative