If a company prepares its financial statements three years after the end of its accounting period,it has violated the qualitative characteristic of:
A)understandability.
B)timeliness.
C)verifiability.
D)materiality.

Question

Quizplus · Accepted Answer

The qualitative characteristic violated in this scenario is timeliness. Timeliness requires financial statements to be prepared in a timely manner to be relevant to users. Waiting three years after the end of the accounting period to prepare financial statements is considered untimely and violates this qualitative characteristic.

If a Company Prepares Its Financial Statements Three Years After