Accounting Theory
Recognition and measurement in financial statements
In December 1984, the FASB issued Statement of Financial Accounting Concepts No. 5,
"Recognition and Measurement in Financial Statements of Business Enterprises", describing
recognition criteria and providing guidance for the timing and nature of information included in
financial statements. The recognition criteria established in the Statement are fairly consistent with
those used in current practice. The Statement indicates, however, that when information more useful
than currently reported information is available at a reasonable cost, it should be included in financial
statements.