Relevance and Reliability in Ais

Table of Contents

Introduction……………...……………………..…………………………………….1

Body……………………………………………………...……………………………1

Conclusion……………………………………………………………………...……..3

Bibliography……………………………..…………………………………………...4

The Role of “Relevance and Reliability” in the conceptual framework

Student’s name: Lin Hongyu

Student ID: 3863691

Teacher’s Name: Jane Shang

Due Date: August 30, 2011

Word count: 983

Introduction

Accounting information system produces accounting information which contains quality accounting information that meets users’ needs. There are factors such as understandability, relevance, reliability and comparability that are recognized as features of accounting information quality by legislator and experts. Relevance and reliability are included in the primary qualitative feature, they are the elements that impact on the prediction and decision making by users, assuring the information are faithful, not bias and without errors are the function of the two features as well. As relevance and reliability act as significant roles in accounting information system, their positions in the conceptual framework are going to be presented out in this essay. The definitions of relevance and reliability will be describes first and then followed by the comparison of the relationship between them in the following word.

Body

The current framework of Accounting Information System describes relevance as the "capacity of information to make a difference in a decision by helping users to form predictions about the outcomes of past, present and future events, or to confirm or correct prior expectations." (Hoggett, Edwards & Medlin, 2009). Being one of the primary features in the framework, relevant accounting information would be valuable and be significant to users. It is accessible on time and also has forecast value and feedback connection (to compare planned and accomplished value) as well (Boris et al. 2006). According to the...