Choose one or more characteristics from the following list that you could use to discuss the accounting aspects of each of the statements and explain your ideas:
● Relevance
● Materiality
● Predictive value
1. Director: 'We do not need to tell shareholders about a loss of £2,000 on damaged stock when our operating profit for the year is £60m.'
2. Shareholder: 'I would prefer the statement of financial position (balance sheet) to tell me the current market value of land is £20m than to tell me that the historical cost is £5m, although I know that market values fluctuate.'