The Consistency Principle ensures that similar transactions are:

The Consistency Principle in accounting is crucial for achieving comparability and reliability in financial reporting. It mandates that similar transactions should be recorded in a uniform manner over time. This means that once a company chooses a specific accounting method or approach for certain types of transactions, it should continue using that same method consistently in subsequent reporting periods. This uniformity allows stakeholders—like investors, auditors, and management—to compare financial statements across different time periods and understand the company's performance more transparently.

Using different reporting methods from year to year could mislead users of the financial statements, as they would not be able to effectively compare financial results or assess trends. The correct answer emphasizes the importance of consistency in financial reporting, which ultimately enhances the credibility and clarity of financial statements.