Recent changes brought on by Sarbanes-Oxley and the PCAOB have made the subject of how accounting standards are set both important and timely.
b. Describe the objectives of financial reporting and its role in the economy.
c. Analyze the role of ethics in financial reporting.
The objectives of financial reporting are to provide the current and potential investor along with other interested parties with the facts about the finances of a company. Year end annual reports and income statements show such things as the total picture and assets and cash as well as the liabilities of the company, long term and short term debt. Balance sheets provide a snapshot of the company. These are important since the financial stability of companies point toward the stability or health of the economy in specific industries and overall. The ...
The objectives of financial reporting and its role in the economy are discussed along with an analysis of the role of ethics in financial reporting. The issue of transparency is also discussed.