The Conceptual Framework identifies comparability as a qualitative characteristic of useful financial reporting information. This paper explains what comparability is, why comparability is desirable, how comparability is achieved, and when we might achieve it. In particular, comparability is the qualitative characteristic that enables users to identify and understand similarities in, and differences among, items; comparability aides investors, lenders and other creditors in making informed capital allocation decisions; and achieving comparability depends on firms applying a common set of financial reporting standards and on requirements in the standards, especially measurement requirements. The paper discusses research showing that greater comparability can lower costs of comparing investment opportunities and improving financial reporting information quality. When comparability might be achieved is uncertain, although much progress has been made recently.
