Reporting entities have flexibility to present disclosures differently as long as all the required disclosures are met.
Accountants creating financial reports use both quantitative measures and qualitative measures to provide such disclosures.
Quantitative measures means that you use an actual numbers disclose an amount or to show a change. For example, "net income for the year was $1,000,000" is a quantitative measure.
Qualitative measures means not showing an actual number, but rather providing information in other ways such as using relative terms or such. For example, disclosing an entities objective for holding or issuing derivative instruments, context necessary for understanding those instruments, strategies used to meet those objectives, and information helpful in understanding derivative activity is a qualitative measure.
Some disclosures tend to be rather objective in nature requiring little professional judgment. Other disclosures can be quite subjective, calling on an accountant to use their experience and judgment to provide the appropriate useful information.
Objective means that judgment is based on the facts of the situation and are not based on or influenced by personal feelings, preferences, tastes, or opinions. For example, balance sheets are included in financial reports and assets are part of a balance sheet is objective and there is no room for judgment.
Subjective means that judgment can be based on or influenced by personal feelings, preferences, tastes, or opinions. For example, whether a certain subsequent event is material and how to best disclose that event can be subjective, requiring significant professional judgment.
The overarching guidance to disclosing information is whether the information is useful in making useful decisions. To be useful, the information possesses the following characteristics: relevance, reliability, comparability, and consistency.
Relevance means that the financial information makes a difference when making a decision. The information matters.
Reliability means that the financial information is free from bias and errors.
Comparability means that a standard set of financial reporting principles are used. But given options, reporting entities are free to chose between alternatives. For example, one company might use FIFO for valuing inventories and another uses LIFO.
Consistency means that a reporting entity uses the same standard accounting principle and reporting approach/method from period to period. For example, a reporting entity cannot flip-flop between FIFO and LIFO.
A few specific aspects relating to comparability and consistency are worth pointing out because they are often confused. Users of financial information often expect that every aspect of every reporting entities financial report to be comparable to every other reporting entity financial reports. This is simply not the case. Financial reports are not, and should not, be a 'form' which is filled in by an accountant. One strength of US GAAP is its ability to let reporting entities report useful information specific to that entity.
Financial information reported by entities in the same industry sector tends to be more comparable than financial information reported by industries in different industry sectors.
A reporting entity's disclosures from period to period tends to be very comparable. While what disclosure information is considered useful by a given reporting entity for a given event or transaction; once the disclosure approach is selected then the company specific disclosure of that information from period to period tends to be very consistent and comparable for any given reporting entity.
Accountants creating a financial report use disclosure rules/requirements, guiding principles, and their judgment when weaving together an appropriate financial report.
Some financial report disclosures tend to take the shape of very specific and objective quantitative measures. For example, the disclosure of earnings per share is an example of such a specific quantitative measure. These sorts of disclosures are like an "on/off" switch; either the disclosure is required or it is not and if it is required, what must be presented or disclosed is crystal clear. There may be judgment involved in computing or measuring the amount disclosed, but the need for the disclosure itself tends to be objective.
Other disclosures take the shape of being more subjective in nature and use more qualitative measures. For example, the derivative instruments example used above, the meaning of a business acquisition or divestiture to the overall financial position of a reporting entity or which information about the acquisition or divestiture is the important information depends on many different criteria and it is the role of accountants to exercise their judgment and determine the appropriate disclosures, all things considered, using known guiding principles.
Understanding which disclosures tend to take which shape and otherwise understanding these moving pieces is critical for financial report taxonomy creation, financial report creation, and analysis of financial information expressed by these taxonomies and financial reports.
There are times when certain specific financial disclosures within two different financial reports will be very different, each reporting different facts. Both financial disclosures being appropriate for the circumstances and both satisfy prescribed disclosure rules/requirements, both be useful, etc.
Other times facts disclosed should be identical for reporting entities.
Understanding the difference is part of the art and science of financial reporting.