A change in the price level makes analysis of the financial statement of different accounting years meaningless because accounting records ignore.....................

Change in the value of money

The correct answer is option 3- Change in the value of money.

The financial accounting is based on stable money measurement principle. It implicitly assumes that price level changes are either non-existent or minimal. But the truth is otherwise. We are normally living in inflationary economies where the power of money declines constantly. A change in the price-level makes analysis of financial statement of different accounting years meaningless because accounting records ignore changes in value of money.