Answer to Question #131778 in Accounting for Vivian Miza

Question

What is considered a practical constrain on the qualitative characteristics

Answer 1

Constraints on the qualitative characteristics are restrictions that arise when an entity is trying to provide information that has qualitative characteristics. The most practical constraint is the cost.

Accounting information is never free. The cost of providing accounting information should not be more than the expected benefits. Should the cost be projected to be higher than the benefit, then the providers of such information should modify the cost-benefit principle.