Identifying Violations of Qualitative Characteristics Identify which qualitative characteristic (comparability, verifiability, timeliness, or understandability) is potentially violated in each of the sit 1. A company that has utilized straight-line depreciation since its inception, disclosed a change to the average-cost method in t 2. The newly hired auditors for a company are unable to substantiate the accounts receivable allowance reported in the prior year's fina 3. Notes to financial statements do not clearly provide the categories of investments that are consolidated into one line on the balance 4. Due to the unexpected resignation of the CFO in January, the company did not issue its annual financial statements (year-end Decem 1. 2. 3. 4. + ()

Identifying Violations of Qualitative Characteristics Identify which qualitative characteristic (comparability, verifiability, timeliness, or understandability) is potentially violated in each of the sit 1. A company that has utilized straight-line depreciation since its inception, disclosed a change to the average-cost method in 2. The newly hired auditors for a company are unable to substantiate the accounts receivable allowance reported in the prior year's fin 3. Notes to financial statements do not clearly provide the categories of investments that are consolidated into one line on the balance 4. Due to the unexpected resignation of the CFO in January, the company did not issue its annual financial statements (year-end Decem bility) is potentially violated in each of the situations 1 to 4 . a change to the average-cost method in the current year, only to change back to straight-line depreciation in the following year. ble allowance reported in the prior year's financial statement (audited by the prior auditors). are consolidated into one line on the balance sheet labeled "investments." annual financial statements (year-end December 31 ) until june, the company typically would release financial statements in early March