Chapter 1 notes - Financial Statements and Financial...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Financial Statements and Financial Reporting --The essential characteristics of accounting are: the identification, measurement and communication of financial information about economic entities to interested parties. Financial Accounting: the process that culminates in the preparation of financial reports on the enterprise for use by both internal and external parties. --Financial statements are the principal means through which a company communicates its financial information to those outside it. Allocating and Capital Allocation -- Resources are limited. Efficient use of resources often determines whether a business thrives, and that places a substantial burden on the accounting profession. --Accountants must measure performance accurately and fairly on a timely basis, so that the right managers and companies are able to attract investment capital. --Relevant and reliable financial information is necessary for markets to be efficient The Challenges Facing Financial Accounting --Nonfinancial measurements: Financial reports failed to provide some key performance measures widely used by management, such as customer satisfaction indexes, backlog information, and reject rates on goods purchased. --Forward looking information: Financial reports failed to provide forward looking information needed by present and potential investors and creditors.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 02/12/2012 for the course BT 1003 taught by Professor As during the Spring '11 term at American Jewish University.

Page1 / 2

Chapter 1 notes - Financial Statements and Financial...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online