Preview

Financial accounting information stakeholders duped

Good Essays
Open Document
Open Document
332 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Financial accounting information stakeholders duped
Financial accounting information stakeholders duped
It is a sine quo non for business leaders to use, rather than just produce financial information. I am in absolute agreement with this phenomenon in that the information generated by the international professional accounting community highly affects various stakeholders in the decision making process to govern businesses. Therefore any material elements within the financial information that boarder on misguidance will lead to corporate financial disaster as can be deduced from history.
Being in the accounting and finance fraternity, I have always being challenged by a million dollar question relating to the complexity of the stakeholders of financial accounting information. Indeed it is a challenge; however, this cannot be used as an excuse to perpetrate financial accounting information misguidance to satisfy selfish interests.
People that indispensably make use of financial accounting information include customers, suppliers, shareholders, employees, financial institutions etc. I am of a view that these stakeholders have adventedly and vividly been duped by the international accounting profession to an extent that confidence has been corroded.
There is a long list of historical cases that document a series of financial scandals that are as a result of deliberate misguidance instigated by the international financial professional in order to fulfil ill financial ambitions. The famous Enron, WorldCom, HIH Insurance, Barrings Bank etc. Apparently, this is why I am totally agreeing to the fact that the international accounting profession has lost its way and is no longer attending to the needs of diverse users of accounting information in a manner which is apposite and evocative for the global business environment today. In conclusion, I would like to assert that there is a need of a holistic and concerted set of efforts to curb all these mushrooming financial machinations.
References:
Stockholders and



References: Stockholders and Stakeholders: A new perspective on Corporate Governance. By: Freeman, R. Edward; Reed, David L.. California Management Review, Spring83, Vol. 25 Issue 3, p88-106 Shiller R. (2003), “From Efficient Markets Theory to Behavioral Finance”, Journal of Economic Perspectives, vol. 17, n. 1,

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Acc/290 Week 3

    • 286 Words
    • 2 Pages

    While some of these accounting concepts proved to be more difficult to grasp than others, it’s easy to see why they are so crucial to providing the most accurate financial statements possible. The skills gained have provided insight to what rigorous steps must take place within the accounting world in order to be…

    • 286 Words
    • 2 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Acctounting

    • 630 Words
    • 3 Pages

    I think global accounting standards are challenging for accounting professionals today. I think it is important that all participants, especially those who work in integrated world capital markets where the demands are comparability and transparency of financial reporting are used…

    • 630 Words
    • 3 Pages
    Satisfactory Essays
  • Powerful Essays

    This course begins with a conceptual review of accounting principles, and reviews issues studied in earlier courses from the point of view of the effects that accounting choices and “creative” accounting have on financial statements. This course emphasizes the role of communication in the accounting profession. Critical thinking and problem solving skills are developed through extensive case analysis.…

    • 4714 Words
    • 18 Pages
    Powerful Essays
  • Good Essays

    Much success in today’s business world is tied in with numbers in the form of accounting and financial statements. Being able to understand and properly read these statements is a critical component in truly knowing a business and properly assessing its overall financial performance. Financial reporting is the issuance of written documents in the form of the financial statements by the companies to the shareholders, stakeholders and other interested parties. 'The objective of these financial statements is to provide information about the reporting entity's financial performance and position that is useful to the wide range of users for assessing the stewardship of the entity's management and for making economic decisions. 'To be 'useful,' this information must be 'represented faithfully, should be complete, prudent and free from material errors at least.' The purpose of imposing regulations on accounting practices and setting standards is to fulfil the objectives of financial statements.…

    • 862 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    It is important for an organization to have accurate and transparent accounting information which can increase the confidence of their users (Watson and Head, 2012). This…

    • 3192 Words
    • 10 Pages
    Powerful Essays
  • Powerful Essays

    With the development of the stock markets and the huge grow in the volume of money traded in them, over the past 20 years a rising attention has been aimed at towards the importance of truthful and fair accounting. The real interest in how companies chase their financial reporting has developed in the wake of a multitude of large corporate scandals that has occurred worldwide. Two of the best known examples so far for significant manipulation of accounting data and the consequences thereof are the collapses of Enron and World Com.…

    • 2057 Words
    • 9 Pages
    Powerful Essays
  • Good Essays

    Hence, a view has been adopted by the regulators that users of financial statements should have a certain level of knowledge, and when accounting standards are being developed, this level of knowledge is assumed. In defence of this position, we could probably argue that if such an assumption was not made then the development of accounting standards would be much more difficult and time consuming given that the standard-setters would need to consider how uninformed users might react to the particular standards. The position adopted is also consistent with other professions which also typically assume a certain level of expertise when developing guidance for their professions’ members (however, we need to be careful with justifications like this—just because others do a…

    • 860 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Accounting Scandals 3

    • 10869 Words
    • 44 Pages

    Financial accounting is one branch of accounting and historically has involved processes by which financial information about a business is recorded, classified, summarized, interpreted, and communicated; for public companies, this information is generally publicly-accessible (Financial Accounting Info, 2006). Accounting attempts to create accurate financial reports that are useful to managers, regulators and other stakeholders such as shareholders, creditors or owners (Financial Accounting Info, 2006). Inefficiencies in the processes of accounting may amount to a professional scandal. Accounting scandals or fraud can be explained in various ways.…

    • 10869 Words
    • 44 Pages
    Powerful Essays
  • Powerful Essays

    The purpose of this report is to critically analyse the financial ratio results of Morrison 2008 and 2009 as an equity analyst and compare it with like for like by using Tesco supermarket.…

    • 2112 Words
    • 9 Pages
    Powerful Essays
  • Good Essays

    As people need to speak the same language to understand each other while talking, participants on the global market also need to have similar accounting language in order to communicate in between. For that reason, it is not a surprise that the business world is moving towards establishment of International Financial Reporting Standards, which is quite likely that soon will become the global accounting language. Adopting same rules and principles across countries is certainly not an easy task and there are many obstacles to be overcome. But reaching a workable set of standards would bring a lot of benefits especially to multinational companies and large foreign investors.…

    • 1120 Words
    • 5 Pages
    Good Essays
  • Good Essays

    Accounting Atrill & Morgan

    • 1217 Words
    • 5 Pages

    Accounting is a subject that is relevant to business enterprises, especially operating, financial accounting, and managerial accounting information. There are many ways to define the work engaged in by the accountants. However, in this accounting course, we only focus on 2 famous professors who have 2 different definitions of the accounting career: Peter Atrill and Gareth Morgan. These 2 doctors gave dissimilar knowledge about accounting but it is still useful to accountants or decision makers. This essay will explain these 2 definitions of both Morgan and Atrill, and a critical discussion that supports my opinion about the better description of the work of accountants.…

    • 1217 Words
    • 5 Pages
    Good Essays
  • Satisfactory Essays

    Users of accounting information are either internal or external to the organization. These users need information to help them make informed or reliable decisions or judgements with regards to the organization. Different groups have different demands for the financial information contained in a set of accounts.…

    • 367 Words
    • 2 Pages
    Satisfactory Essays
  • Powerful Essays

    Lecture Series in Accountancy, Critical issues in Accounting Forum, Wake Forest University, April 25, 2000.…

    • 4340 Words
    • 26 Pages
    Powerful Essays
  • Powerful Essays

    ABSTRACT Fair value accounting has received a significant amount of blame as the cause of the current financial crisis. Fair value accounting does not cause illiquidity or volatility in financial markets. Banks, rather than accounting, caused the existing crisis, ultimately through bad lending decisions and inadequate risk management. Accounting rules are designed to reveal the full extent of losses and future risks. This transparency would enable banks, regulators, and government to identify specific sources of the crisis and take steps toward recovery and future prevention. Shooting the accounting messenger is not a solution to the problem. Perhaps confusion exists regarding the conflict between transparency and financial stability. Transparency is an objective of accounting standards. Long term stability is best achieved by restoring investor confidence in financial markets and assets. Transparent accounting standards and sound auditing provide support for that confidence. Evidence from the recently released SEC study on mark-to-market accounting supports fair value as the most relevant measurement attribute for financial instruments. Suspension of fair value in favor of alternative cost-based measures would mask losses in value, mislead investors, and diminish investor confidence. From an ethical perspective, accounting has a responsibility to see that financial statements are fairly presented---reflect economic reality. Accountants and auditors are ethical detectives holding businesses to ethical standards of honesty, completeness, neutrality, and representational faithfulness. Accountants and auditors are bound by their professional code of conduct to protect the public interest. So grounded, accounting is the provider of one of the essential checks and…

    • 6378 Words
    • 26 Pages
    Powerful Essays
  • Powerful Essays

    A vital message of the work is that researchers in accounting Information (AIS) and other areas accounting, such as financial, Auditing, Tax and managerial should work…

    • 1663 Words
    • 7 Pages
    Powerful Essays