Users of accounting information, who do not have day to day access to the record of the business, rely on the integrity and judgment of management to provide suitable information of a high quality. All financial statements are essentially historical documents they shows the financial performance of the company. Most users of financial statements are concerned about what will happen in the future and decision making upon the present or past financial records of the company. Stockholders are concerned in future earnings and dividends. Creditors are concerned with the company’s future ability to repay its debts. Managers are concerned with the company’s ability to finance future expansions. Despite the fact that financial statements are historical documents, they can still provide valuable information bearing on all of these concerns. Hence it has been founded that regulation is needed, particularly for financial reporting by companies in order to ensure a true and fair view of financial reporting. Regulators are the authorised institutions who form regulations and supervision, aiming to maintain the integrity of the financial system. The role of the regulator is to promote understanding by the public of the securities and futures industry and the benefits, risks and liabilities associated with investing in financial products hence the importance of making informed decisions regarding transaction or activities related to financial products and to take responsibility. Different countries have developed their own accounting principles over time, making international comparison of companies difficult. To ensure uniformity and comparability between financial statements prepared by different companies, a set of guidelines and rules are used. Commonly referred to as generally accepted accounting principles(GAAP), these set of guidelines provide the basis in the preparation of financial statements. There are several approved regulatory bodies operate in this field....
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