DC week 1 #2&4 - DC# 4) Over the last ten years,...

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DC# 4) Over the last ten years, accounting principles have become more strict because companies are able to find flaws in the accounting standards and use it to their advantage, therefore the FASB have to re-evaluate their rule and modify it to try to reduce or even eliminate those flaws. 20 years ago, accounting laws were not as specific as they are now. Accounting rules were general where companies are able to report however they feel to make their company’s financial report looks good and still follow the accounting standards at the same time. Now, the accounting standards are much more complex. The purpose of modern accounting regulation is to ensure all financial accounting from different companies are consistence and comparable to each other, so that the users of these financial reports can rely on them to make financial decisions. Honest disclosure assures that investors in financial markets can make good decisions on investment and the stock market generally has a higher valuation because of that. It also assures that banks and
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This note was uploaded on 06/25/2011 for the course ACC 363 $21 taught by Professor Mr.someone during the Spring '06 term at University of Phoenix.

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DC week 1 #2&4 - DC# 4) Over the last ten years,...

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