The Hong Kong and China Gas Company Limited, Annual Report 2015
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IntroductionThe objective of financial statements is providing useful accounting information to present and express any changes in financial position of company. It is useful for many kinds of users for making economic decisions. It also provided useful information to wide range of users such as Suppliers, Customers, Shareholders, General Public and Governments, etc.Accounting Information for qualitative characteristics serve a mainly supporting role in the decision making, decision approach to accounting theory. Qualitative characteristics make the information provided in financial statements to be useful for users as nutrient. The information is reported to boost up decisions making. It should possess certain characteristics or normative standards, which has been referenced by the Hong Kong Institute of Certified Public Accountants in its Chapter 3 “Qualitative characteristics of useful financial information”.BackgroundTowngas was Founded in 1862. By the past years, Towngas has been growing up from the simple gas supplying and fueling for street lamps, now on Towngas is leading Hong Kong gas market at first class. The business is fully support in product, redistribute and selling of fuel gas, and provide the best after-sales services. (The Hong Kong and China Gas Company Limited, Annual Report 2015)PART AThe qualitative characteristics of financial statement are useful for the existing investors, other lenders and creditors in current market for making decisions on the basis the information of company’s financial report.Financial reports provide useful information about company income and expenditure, any effect of transactions change, asset and liabilities, other notes of shareholder’s equity. Financial reports may also give explanatory notes of managment’s planning and development in the financial report and expectations information.Financial information must be relevant and faithfully to present its objective if it is useful for public, and improve to more easy comparable, verifable , timely and understandable with other company.(HKICPA, Chapter 3, QC6 – QC32)Financial statements describe the dialy transactions and contained different classify of accounting information in term of economic resources. These classify of accounting information which is elements of financial statements are directly related to balance sheet and income statement as assets, liabilities, equity and income and expenses relatively. The statement of financial position changes are reported because the change of income statement elements and balance sheet elements. That why conceptual framework identifies no elements are sole unique in statement. The process of sub-classification are involved in the presentation of these elements. Such as assets and liabilities are classified by their nature and function in the business of company, and present the information in format which easy to users for making economic decisions.(HKICPA, Chapter 4, 4.8 – 4.28)The process of recognition for financial statements are involved the description in words and term of monetary amount included in the balance sheet and income statement. And some items are fail to recognize that will not disclose but present as a note by the end of the report. The element should be recognised if they are possible to flow in or out as future economic benefit from the company, and the element has a cost or value to can be measured with reliability.(HKICPA, Chapter 4, 4.37 – 4.39)

The process of measurement for financial statements are also determined by term of monetary amount, which recognised in the balance sheet and income statement. Different kinds of measurement base are applied for different degrees in financial statements. They are including historical cost, current cost, realisable value and present value.Historical Cost means assets are recorded at amount of cash or cash equivalents paid or asset buy at the time of fair value. Liabilities are recorded at the time which received from obligation, and at amount of cash or cash equivalents paid to settle the liability of daily company business transaction.Another measurement is current occurred in statement as Current Cost. Assets are recorded at amount of cash or cash equivalents paid at the same value which receive at current as a new one. Liabilities are carried out as undiscounted value of cash or cash equivalents that would be settled at current.Realisable Value measurement means assets value counted that may disposal at the amount of cash or cash equivalents in current. Liabilites are counted as the settlement value that the undiscounted value of cash or cash equivalents that expected to be settled at current.Finally is Present Value, assets are counted at discounted value from future cash flows value in which expected to produce out. Liabilities are counted at discounted value from future cash flows value out which expected to produce out.(HKICPA, Chapter 4, 4.54 – 4.56)PART BFinancial information should be useful, it should be relevant and faithfully to presents what its objective information to present for the public. It is comparable, verifiable, timely and understandable for financial information to improve the usefulness.The qualitative characteristics could be help to improve the useful of information by comparability and understandability.Relevance means the information must be relevant bewteen users need and finance statement, that help users to more easy to making economic decisions. If finanacial information is relevant that can be making a difference for difference kinds of users for making decisions, or else the users do not making any advantage decision. Relevant financial information still be a useful knowledge from the other outside sources. Financial information can be making a difference decisions making for users, and it included predictive value and confirmatory value. Both of predictive value and confirmatory value are related to the financial information. The predictive of future revenues will based on the information of current year, and also can make current of budget by the past few year relevant information. That is more easy for users to compare for adjustment and predictions are more accurate.As a shareholder, we concern the core of investment reture, we can read the Annual Report of the Hong Kong and China Gas Company Limited (Towngas)

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Useful Accounting Information And Introductionthe Objective Of Financial Statements. (June 17, 2021). Retrieved from https://www.freeessays.education/useful-accounting-information-and-introductionthe-objective-of-financial-statements-essay/