Accounting ACC / 561

Topics: Balance sheet, Internal control, Enron Pages: 4 (1141 words) Published: March 26, 2014
Describe the main aspects of a regulatory environment
Regulatory Environment are designed with regulations and laws developed by federal, state, and local governments to exert control over business practices ( It is becoming clear to the world at large that good corporate governance is a vital ingredient, not only for financial entities but also for the entire corporate world. Adherence to sound principles can have important implications for the health of the economy, and as the world becomes more global, for global financial health (Dr. Marion Williams, Governor, Central Bank of Barbados, 2007). The era of globalization has facilitated the pace of mergers and acquisitions, the creation of huge corporate organizations, and the entry of players who represent a mix of disciplines (Dr. Marion Williams, Governor, Central Bank of Barbados, 2007). There is four methods to report financial accounting documents for corporations to report profits or loss. A statement of cash flows, retained earnings, and balance sheet. The Balance Sheet is a financial statement, which describes the financial condition or of financial position of the company. The balance sheet displays the liabilities, capital equity, and assets of the corporation or business. Another financial document known as Income Statement reveals financial information of the business for corporate investors or analyst to study the financial status of the business. The Cash Flow Statement describes the status of liquidity within operations, and reveals if profits are obtained. Last a Retained Earnings statement describes the cumulative earnings of the corporations and subtracts the dividends to form the original declared value. The regulatory environment of the accounting world is vital inasmuch as it governs the accuracy and integrity of data reporting in the business world. The health of the economy depends on its effectiveness and efficiency. SOX Requirements

Businesses that value integrity...
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