In order to justify requiring a particular measurement or disclosure, the benefits to be derived from it must equal the costs associated with it.

Question

Quizplus · Accepted Answer

The Financial Accounting Standards Board (FASB) and other standard-setting bodies often consider whether the benefits of a new standard are likely to outweigh its costs, but this does not mean the benefits must exactly equal the costs. The assessment is more about whether the benefits justify the costs, not a precise equality.

In Order to Justify Requiring a Particular Measurement or Disclosure