Accounting Assumptions: Underlying assumptions for the preparation and presentation of financial statements are accrual and going concern. Accrual assumption: The effects of transactions and other events are recognised when they occur (and not as cash or its equivalent is received or paid) and they are recorded in the accounting records and reported in the financial statements of the periods to [...]
The following points highlight the seven major limitations of financial reporting. 1. The objectives of financial reporting are affected not only by the environment in which financial reporting takes place but also by the characteristics and limitations of the kind of information that financial reporting, and particularly financial statements, can provide. The information is to a significant extent financial information [...]
In this article we will discuss about Financial Reporting:- 1. Concept of Financial Reporting 2. Objectives of Financial Reporting 3. Developments on Financial Reporting Objectives Concept of Financial Reporting: Financial reporting may be defined as communication of published financial statements and related information from a business enterprise to third parties (external users) including shareholders, creditors, customers, governmental authorities and the [...]