Module 1 provides a nice overview of concepts that we will cover over the remainder of the course. Ultimately, accounting information is important for decision making. Therefore, all else equal, high-quality accounting information is important for better decision making. Can anyone think of some attributes of high-quality accounting information (characteristics that result in relatively higher quality)? Can you think of ways that financial accounting information quality might be impaired?

Having a good understanding of accrual accounting generally and the relationship between the financial statements is key to being able to analyze them effectively. Further, while understanding what GAAP provides informationally is important, understanding what it does not provide is significant as well. Such understanding allows us (as analysts) to better determine the level of reported financial statement information quality that exists in a particular information set and decision-making context. What can we as analysts do generally if the perceived information quality is poor, and we must make an important decision based on that information?