Faithful representation – Financial information that faithfully represents the phenomena that it purports to represent. A faithful representation provides information about the substance of an economic phenomenon instead of merely providing information about its legal form. A perfectly faithful representation would be complete, neutral and free from error. Providing a faithful representation is one of the two fundamental characteristics of useful financial information (see diagram).
Neither a faithful representation of an irrelevant phenomenon, nor an unfaithful representation of a relevant phenomenon helps users make good decisions (Framework QC17).
Reliability is not specifically mentioned in the Conceptual Framework IASB has explained that this characteristic is included in faithful representation [IASB 2010 BC 3 24].
Completeness refers to … Read more