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Basic Question 1 of 9
High-quality earnings are, by definition, ______.
B. accurate
C. conservative
A. repeatable
B. accurate
C. conservative
User Contributed Comments 6
| User | Comment |
|---|---|
| Naufil2004 | Why is the last choice incorrect? |
| Gina | conservatism is an accounting concept by which you present your results with the least favorable figures. you can report conservatively, but run your business in such a way that your earnings wildly fluctuate from year to year (in which case they would not be considered of high-quality). |
| chenyx | High-quality earnings are repeatable,and result from the use of conservative accounting priciples that do not result in overstated revenues or understated costs. |
| olagbami | yeah right |
| vatsal92 | It is High-quality only if it's repetitive. |
| tunjihpmtd | yeah .correct |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
describe the roles of the statement of financial position, statement of comprehensive income, statement of changes in equity, and statement of cash flows in evaluating a company's performance and financial position;
CFA® 2024 Level I Curriculum, Volume 2, Module 16.