Final answer:
The Conceptual Framework for financial reporting highlights relevance and faithful representation as the two fundamental qualitative characteristics while also mentioning enhancing characteristics that improve the usefulness of financial statements.
Step-by-step explanation:
Fundamental Qualitative Characteristics of Financial Statements
The Conceptual Framework for financial reporting identifies two fundamental qualitative characteristics that make the information provided in financial statements useful to users. These are relevance and faithful representation. Relevance means the information should have the ability to make a difference in the decisions made by users. Information is relevant when it is timely, provides predictive and confirmatory value. On the other hand, faithful representation means that the financial information reflects the economic phenomena it purports to represent. It should be complete, neutral, and free from error.
There are also several enhancing qualitative characteristics, which are comparability, verifiability, timeliness, and understandability. This ensures that financial statements are not only fundamental but also beneficial for analysis and decision-making purposes.