E 1-7 Concepts; terminology; conceptual framework CL01-7 Listed below are several terms and phrases associated with the FASB's conceptual framework. Pair each item from List A (by letter) with the item from List B that is most appropriately associated with it. List A List B 1. Predictive value a. Decreases in equity resulting from transfers to owners. 2. Relevance b. Requires consideration of the costs and value of information. 3. Timeliness c. Important for making interfirm comparisons. 4. Distribution to owners d. Applying the same accounting practices over time. 5. Confirmatory value e. Users understand the information in the context of the decision being made. 6. Understandability f. Agreement between a measure and the phenomenon it purports to represent. 7. Gain g. Information is available prior to the decision. 8. Faithful representation h. Pertinent to the decision at hand. 9. Comprehensive income i. Implies consensus among different measurers. 10. Materiality j. Information confirms expectations. 11. Comparability k. The change in equity from nonowner transactions. 12. Neutrality 1. The process of admitting information into financial statements. 13. Recognition m. The absence of bias. 14. Consistency n. Increases in equity from peripheral or incidental transactions of an entity. 15. Cost effectiveness o. Information is useful in predicting the future. 16. Verifiability p. Concerns the relative size of an item and its effect on decisions. Page 38 E 1-8 Qualitative characteristics