10RQ.
Question
Which concept states that accounting information should be complete, neutral, and free from material error?
Step-by-Step Solution
Verified Answer
The concept is “Faithful Representation”.
1Step 1: Explanation on faithful representation
As per the faithful representation concept, accounting information presented in the financial statements should be neutral, complete, and with no material error.
2Step 2: Misrepresentation in financial statement
If there is any misrepresentation in the financial statement, then it violates the faithful representation concept, as it may affect the decision of the stakeholders.
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