Accounting Information Systems: Characteristic Of Useful Information

October 19th, 2006 Comments off
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In the earlier article, we understand that data is merely raw materials, it needs to be converted ( collected, processed, classified ,etc) into useful/meaningful facts  so as to enable Management to made decisions.

So what are the criteria of being consider as USEFUL information?



Information is relevant if it reduces uncertainty, improves decision makers ability to make predictions, or confirms or corrects their prior expectations.


Information is reliable if it is free from error or bias and accurately represents the events or activities of an organization.


Information is complete if it does not omit important aspects of the underlying events or activities that it measures.


Information is timely if it is provided in time to enable decision makers to use it to make decisions.


Information is understandable if it is presented in a useful and intelligible format.


Information is verifiable if two knowledgeable people acting independently would each produce the same information.

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Financial Accounting


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