The purpose of financial reporting is to provide valuable information to benefit economic decisions (Financial Accounting Standards Board, 2008). The knowledge reflects the financial impact of transactions to manage a capitalist system. A business enterprise will compare the statement to determine opportunities for long-term economic growth (Association of Chartered Certified Accountants, 2013). The report will include accurate details to uncover ethical issues, which affect the balance of accounting policies of presenting and disclosing information for public use. Venture capital firms rely on the mandatory disclosure of financial statements specified in the Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting System (IFRS) (Gibson, 2013). The article of focus is to acquire knowledge to create sound judgment and to provide harmony because accurate financial statements create effective communication across borders.
Ethics
Various organizations maintain a stable financial position to obtain short-term investments. The Investopedia (2014), profit is from the surplus of stocks and bonds, which earn high-level dividends instead of a standard interest bearing account. “The Dangerous Morality of Managing Earnings,” illustrates the direction of ethical behavior of corporate managers to influence financial statements to benefit managers or the organization (Bruns & Merchant, 1990, pp.1). The belief of the participants is bending the rules of business methods, which are bookkeeping, deferring cost, and budgets to alter the short-term income. The individual neglects to extend credit and employment hours to increase consignments or the sale of assets to maintain profit (Gibson, 2013). The intention is ...
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Short-Term Investments. (2014). In Investopedia. Retrieved from http://www.investopedia.com/terms/s/shorterminvestments.asp
Ethics plays a vital role in developing accurate and high quality financial statements for management, financial institutions, and investors. As management utilizes financial statements to make decisions regarding the operations of the business, it is necessary to review accurate financial statements to make strategic decisions about the future of the organization. Investors and financial institutions require accurate financial statements to make informed decisions upon whether to invest funds into the organization or the wisdom of lending funds to said organization.
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Marshall, M.H., McManus, W.W., Viele, V.F. (2003). Accounting: What the Numbers Mean. 6th ed. New York: McGraw-Hill Companies.
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AASB, Australian Accounting Standards Board, Statement of Accounting Concepts SAC4 ‘Definition and recognition of the elements of financial stat
Schroeder, Richard G., Myrtle Clark, and Jack M. Cathey. Financial Accounting Theory and Analysis: Text and Cases. 10th ed. Hoboken, NJ: John Wiley & Sons, 2009. 97. Print.
Marshall, D. H., McManus, W. W, & Viele, D. (2002). Accounting: What the Numbers Mean. 5th ed. San Francisco: Irwin/McGraw-Hill.
Financial reporting is an example of an ethical problem for an organization or business. Many busin...
Maintaining a company’s financial assets is a daunting task. Cash management techniques and short-term financing provide accounting executives with the tools needed to survive the constant changes within the economy. The combination of these tools and the knowledge of the world economy will assist companies in maintaining current assets and facilitates growth.
Peasnell, KV 1982, ‘The function of a conceptual framework for corporate financial reporting’, Accounting & Business Research, vol. 12, issue. 48, pp. 243-256, viewed 05 May 2014
These accounting information are so much important for the business owner or financial statements reader to analyze the company and make the economics decision.