Reference

What is audio bit depth?

For integer PCM, bit depth describes the number of bits used to represent each sample value. It affects quantization resolution and the theoretical noise floor/dynamic range of the digital representation.

Useful numbers

Integer PCMApprox. ideal quantization SNR for a full-scale sineTypical context
16-bit~98 dBCD audio, distribution
20-bit~122 dBHistorical/professional converters and files
24-bit~146 dBRecording, production, hi-res distribution

The analogue electronics of real converters usually have a much higher noise floor than the mathematical limit of 24-bit PCM.

Storage bits and valid bits can differ

WAVEFORMATEXTENSIBLE can store, for example, 20 valid bits inside a 24-bit sample container. This is why “24-bit storage” and “24 bits of meaningful converter precision” are not always the same statement.

MP3/AAC/Opus do not preserve a PCM bit depth

A lossy codec may accept 16- or 24-bit PCM and decode back to a PCM representation, but “24-bit MP3” is not equivalent to 24-bit PCM or FLAC. The encoded signal is represented by the lossy codec's own transform/quantization model.

See 24-bit vs 16-bit.