Resolution of an ADC (number of bits) determines the accuracy of the system
Accuracy = Range/2 (Number of bits)
For example when converting a 5V input voltage to a digital signal using a 10 bit ADC, the minimum voltage the signal will detect will be
5/(2^10) =5/1024 = 4.88 mV
or accuracy in percentage 100/1024 = 0.098%
If you are using a 12 bit ADC, the accuracy at which the signal will detect be
5/ (2^12) = 5/4096 = 1.22 mV
or accuracy in percentage would be 100/4096 = 0.024%