IntroductionIn today's competitive supermarket industry, one of the largest companies is Tesco plc. Tesco operates 2,318 stores in 12 countries and employs 380,000 people worldwide. As with other businesses in the market, the main goal of the business is to maximize profits for its owners. Additionally, Tesco is trying to expand into the international market. It is therefore possible to find Tesco supermarkets in continental Europe, parts of Asia and some cities in the United States. As other public companies do, Tesco must provide the public with annual reports including the company's financial statements, such as the statement of financial position, income statement, cash flow statement and statement of changes in equity. The International Accounting Standards Board (IASB) framework has developed a set of characteristics that should be considered when evaluating the usefulness of these financial statements. Qualitative Characteristics To begin with, financial reports are not perfect because the information in the statements is primarily intended for investors. , and there isn't much direct information for other business stakeholders. However, other users may use assumptions and find useful information by reviewing the financial information provided in annual reports. Tesco's financial statements are classified according to four qualitative characteristics of the IASB framework. These are: understandability, relevance, reliability and comparability. Tesco reports provide notes to the group's financial statements for a more in-depth understanding of the financial accounts. Making the information understandable is the least achievable goal, because the financial information contained in the statements includes calculations, terms,...... middle of paper ......ing. Second edition, Prentice Hall Europe 1985, 1994; 1994. P 1135. http://www.iasb.org/NR/rdonlyres/8C532526-9CE7-49B6-84BB-446BEDA65541/0/ias07sum.pdf6. Weetman,P. (2011). Financial and management accounting. An introduction. . 5th ed. London: Financial Times Pitman Publishing imprint. p175.7. http://www.telegraph.co.uk/news/uknews/1548956/Tesco-in-numbers.html8. http://en.wikipedia.org/wiki/Financial_statement9. Brammer, J., Cox, D., Fardon, M and Penning, A. (2002). Active accounting. A simple guide to financial and management accounting. 2nd ed. Worcester: Osborne Books Limited. p25310. Britton, A. and Waterstone, C. (2010). Financial accounting. 5th ed. London: Pearson Limited Company. p66.11. Finch,C. (2008). A student's guide to international financial reporting standards. 2nd ed. Wokingham: Kaplan Publishing UK. p7.