Which accounting principle states that information should be useful for decision-making?

The principle that states information should be useful for decision-making is relevance. This principle ensures that the data presented in financial reports has the ability to influence the decisions of users by helping them evaluate past, present, or future events or confirming or correcting their past evaluations. Relevant information typically includes timely data that is pertinent to the specific decisions facing a user, which contributes to a clearer understanding of the economic phenomena being reported.

In the context of accounting, relevance emphasizes the importance of providing financial information that is directly related to the decision-making needs of users, allowing them to make informed judgments about the financial health and performance of a business. This principle underlines how the collected data must not only be accurate but also significant enough to matter in the decision-making process.

The other principles, such as reliability, consistency, and comparability, while important for ensuring that financial information is trustworthy and comparable across periods and entities, do not specifically focus on the utility of the information for decision-making in the same direct way that relevance does.