Answer
(a) To be perceived in the principal body of financial statements, an item must meet the meaning of an element. Also, the item must have been measured, enrolled in the books, and must have gone through the double-entry system of accounting.
(b) Information availed in the notes to the financial summaries intensifies or clarifies the items introduced in the principal body of the statements and is essential to an understanding of the position and performance of the enterprise. Data in the notes do not need to be quantifiable, nor do they have to qualify as an element.
Work Step by Step
Supplementary information incorporates information that presents an alternate point of view from that embraced in the financial statements. Additionally, it includes the management of the financial information and a discussion of the significance of that information.
