Supervise the Sensible Management of Financial Earnings

Accounting Explained. Retrieved February 26, 2014, from AccountingExplained.com: http://accountingexplained.com/misc/corporate-finance/wacc Peavler, R. (2014). Business Finance. Retrieved February 26, 2014, from About.com: http://bizfinance.about.com/od/cost-of-capital/qt/calculate-the-cost-debt-capital.htm Ross, S. A., Westerfield, R. W., & Jordan, B. D. (2011). Essentials of Coporate Finance (7th ed.).

The purpose of this paper is to give a clear understanding of discounted cash flow valuation. The paper will explain what a discounted cash flow valuation is and its importance in financial business decisions regarding investment strategies. This paper will give a detailed discussion about discounted valuations for both present and future multiple cash flows with respect to even and uneven schedules using clear step-by-step examples. Also included will be some advantages and disadvantages in using the discounted cash flow valuation method for corporate business. Finally, the paper will give a summary of important highlights discussed in the body of the paper.

Financial Accounting: An Introduction to Concepts, Methods and Uses. 14th ed. London: Cengage Learning. p84. Weygandt,J., Kimmel,P., Kieso, D. (2009).

Broken into two principles measurement and disclosure that focus on the following areas: the measurement of economic activity; the time when such measurements are to be made and recorded; the disclosures surrounding this activity; and the preparation and presentation of summarized economic information in financial statements. (Paul, 2008) US GAAP importance stems from the need of standardize financial statements, without a standard format, companies could withhold information of financial hardships from investors, creditors, and shareholders. Furthermore, ensures financial statements are comparable and understandable. Defining reasoning for US GAAP to govern how transactions are structured and how legal instruments are drafted. (Deming, 2005) International Financial Reporting Standards (IFRS),created from International Accounting Standards in 2005, performs the same task as US GAAP, but for international business, that spans borders.

The purpose of financial statements Financial statements are the primary instruments used in assessing the performance of a business and its managers (Gibson , 2013). In order to make well informed decisions, interested parties must be able to assume that a company’s financial statements are an accurate representation of its performance. Financial statements are used by customers, employees, governments, investors, lenders, and suppliers to influence numerous types of transactions. Investors can use financial statements to determine a company’s value as an investment. Governments can use financial statements to determine a company’s tax liability.

Fundamentals of Corporate Finance. (2011). Chapter 3 – The Valuation Principle: The Foundation of Financial Decision Making. Retrieved on July 8, 2011 from http://su3finance.wikispaces.com/Chapter+3+%E2%80%93+The+Valuation+Principle-The+Foundation+of+Financial+Decision+Making. Slack, B.

Forexbees: Retrieved November 20, 2013 from http://www.forexbees.com/fixed-exchange-rate-against-the-flexible-exchange-rate/ Hill, C.W.L. (2014). Global Business Today (8th ed.). New York, NY: McGraw-Hill Irwin International Monetary Fund. (2013).

One’s lively hood depends on decisions made in the business world. Business transactions are done daily and can impact one’s economic stability. Trust is placed in the hands of corporate America and an obligation of financial reporting to reveal a complete honest and legal picture of an entity’s accounting practices is important in attaining trust. This paper will discuss the obligations of legal and ethical standards of practice in the financial spectrum. According to Marshall, McManus and Viele (2004), accounting is “the process of identification, measurement, communication of information about a business for the purpose of making decisions and informed judgment” (p.3).

The essay below is going to be analysing and explaining the accounting principal of comparability which briefly means that is a “quality of accounting information that addresses the usability of financial information” (My Accounting Course 2015) and also the importance of investor confidence in the financial statements. Furthermore, there will be an illustration by explaining a particular situation where inconsistencies in accounting treatments can undermine comparability. The accounting principle ‘comparability’ is one of the main characteristics of financial statements (Dunn 2010) so; “in 1989 IASC launched a major initiative to bring greater comparability to financial statements (Roberts, Weetman, Gordon 2008)”. The initiative was represented

The Ethics of Credit Rating Agencies: What Happened and the Way Forward. Journal of Business Ethics. 111 pp.477-490. Steward, H. 2009. This is how we let the credit crunch happen, Ma'am ... [Online] Available at World Wide Web: [Accessed: 27 October 2013] Thomas, E. 2011.