Financial Accounting and reporting Essay Example | Topics and Well Written Essays - 1000 words

Financial Accounting and reporting - push asidevas Examplef financial accounting and reporting is the preparation of financial statements such as the income statement, cash flow statement, fixed assets movement schedule and the balance sheet (MAYNARD, 2013, 309).The financial statements are to be make available to all users of financial information who include creditors, regulators of business operations, investors as well as the giving medication through its valuateation unit. Other objectives of financial accounting and reporting include provision of information that can be used to settle the solvency position of a given business. The financial statements provide information relating to a firms ability to meet its short-term and long-term liabilities as they fall due. The information assists in ascertaining the financial position of a business in terms of its assets and liabilities which assist the business to clearly establish where they stand in reference to what they own an d what they owe others. Another objective to be attained by financial accounting is the fact that it offers systematic recording of business transactions in an organized elan thus enhancing accountability and order in the business (SUTTON, 2004, 26).Providing relevant information to be used by several users of financial statements is one of the top objectives of financial accounting and reporting. It assists the stakeholders in making rational decisions. nigh of the key users of financial statements are listed below.The investors require financial statements in order to evaluate the practicality of investing in a given business venture. Investors use the information specifically to determine and to predict the future of a companys dividend growth through the use of income statements. They are able to further establish the motley forms of risks associated with a given investment through a keen look into fluctuations in after tax profits, share price and dividend growth.The governm ent requires financial statements from all companies and