inclass_work[2][1]

inclass_work[2][1] - The information must be...

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Name: Kris Carroll Case: CF-2 Facts Johnny Jones, Controller for Neilson Manufacturing (NM), maintains that the financial statements of NM should be organized and prepare such that the information is presented in a way that is most useful to NM. Sharon Smith, the Treasurer of NM, disagrees. She believes that NM should take an approach based upon measurement certainty. Are both correct? (Ziebart, 2002) Issues Can the information be presented in a way that is most useful to NM or must the information be based on measurement certainty? Analysis Accounting information must be reliable to the extent that it is verifiable, is a faithful representation, and is reasonably free of error and bias. Reliability is a necessity, because most users have neither the time nor the expertise to evaluate the factual content of the information. The information must be verifiable, independent measures, using the same methods, obtain similar results.
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Unformatted text preview: The information must be representational faithfulness which means the numbers and descriptions match what really happened within the company. And finally the information must be neutral, which means that the company can not select information to favor one set of interested parties over another. Unbiased information must be the overriding consideration. Conclusion NM can not present the financial statement which is most useful to itself because of the neutrality. The information must be neutral and presented in an unbiased method not favoring one user over another. The information must be verifiable and faithful in its representation. References Accounting Standards codification . (n.d.). Retrieved April 6, 2011, from http://asc.fasb.org Intermediate Accounting 12e. (2008). Hoboken: John Wiley & Sons Inc. Pg 32 in Intermediate book – cite correctly...
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