Essay Exam 1

Essay Exam 1 - Discussion Case 2-48 This Discussion Case...

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Discussion Case 2-48 This Discussion Case involves the yearly financial information received by Julie from the companies that she has invested in. Julie evaluates the financial reports yearly and has had some concerns. She would like to have quarterly or even more frequent reports but feels they may not be accurate due to the fact that they are not audited. She would like to use her computer to “interrogate” the companies other computer but is unsure. As Chief Accountant for one of the companies she has concerns with, she has asked for my advice and she has been advised that she needs to understand the differences between financial and managerial accounting and also that our computers are not for outsider or investor view. The main differences of managerial and financial accountants are the people they prepare accounting reports for. Managerial accountants are the accountants that provide information and reports to people inside the organization so that the company's management is able to have the information to make informed decisions about the company at their fingertips. . Financial accountants are the accountants that provide information and financial reports for those people outside the organization that have a need for it or are required to have it. Investors need reports and information so that they are able to make informed investing decisions and governing bodies need reports and information in order to enforce laws and accounting regulations. These reports and statements are prepared according to Generally Accepted Accounting Principles and they reflect conditions as of a given date and provide the results of operations for a specific period, generally the previous accounting period which, for some investors is too late to do anything about it. Both Financial and Managerial accounting are similar because their main goal is to be able to present the company as having the best financial circumstances. Recently, ethics in
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accounting has become a major topic among accountants and has become even more important due to the recent accounting scandals. Because of these scandals and the importance of ethics, both sides of the profession have rules and codes of ethics and conduct the group members must adhere to in order to maintain their certification. While Julie already receives the yearly reports, quarterly reports are a sound decision if she has concerns but anything more frequent does not give in adequete overall picture for investing purposes. Reporting is another area that managerial and financial accountants differ.
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This note was uploaded on 08/12/2011 for the course ACCT 2201 taught by Professor Alvarez during the Spring '11 term at FIT.

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Essay Exam 1 - Discussion Case 2-48 This Discussion Case...

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