CA Foundation · Accounting · Theoretical Framework
Under the Conceptual Framework, comparability as a qualitative characteristic requires that financial information prepared by different entities or the same entity in different periods should be:
Comparability requires that financial information be presented consistently, using uniform accounting policies and clear disclosures, so that users can meaningfully compare performance across entities and time periods. Consistency of policy and disclosure transparency are essential, though presentation formats may vary.
- AIdentical in format and presentation across all organizations
- BCapable of being compared by users, often supported by consistent accounting policies and disclosuresCorrect
- CPrepared using the same accounting method without any exceptions
- DPresented in the same language and currency as competitor organizations
Explanation
Comparability does not mean identical presentation (option A) or strict uniformity without flexibility (option C). Instead, it means users should be able to compare information meaningfully. This is achieved through consistent accounting policies, clear disclosures of changes in policies, and transparent presentation—not necessarily identical formats or language/currency standardization (option D). Option B correctly describes comparability.
Did you get it right without looking?
One question tells you little. A timed set on Theoretical Framework shows your real accuracy, how long you take and where you lose marks.
More Theoretical Framework questions
- Mira Ltd. recognized revenue of ₹50,000 from a service contract in the current year, although cash was received only for ₹40,000. The remain…
- Which of the following is an example of a transaction that is NOT recorded in the books of a business, because of the money measurement conc…
- The Conceptual Framework for Financial Reporting prescribes that financial statements should present information that is useful to a wide ra…
- Ganesh Stores bought goods costing ₹1,20,000 during the year, of which goods costing ₹30,000 remain unsold at the year-end. The net realisab…
- Sharma Enterprises sold goods worth ₹80,000 on credit in March 2025, and delivered them in March. The customer paid in April 2025. Under the…
- Mehta Traders records the purchase of a delivery van for its own use as a fixed asset and not as an expense of the year, even though it was …