Reporting quality
Whether the statements faithfully describe what happened — a separate question from whether what happened was any good, and the one to settle first.
Where you will meet it
Reporting quality appears in 2 learning outcomes on the CFA syllabus. A few of them:
- Set out the range of quality in financial reporting
“Reporting quality and earnings quality are distinct.”
- Show how a conceptual framework is used to judge how reliable and useful a company's financial reporting is
“Reporting quality asks whether the statements are decision-useful: faithful, complete and unbiased.”
Practise it
Practise reporting quality until it is automatic: questions that explain every wrong option.
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