Financial Reporting



Financial Reporting

Introduction

The report deals with the financial reporting concerns drawn down by the writer in the article. In this report we will analyze the financial reporting concerns and how it affects the overall performance of the company and the trust and information base of its stakeholders. In this report we will be discussing the importance of financial reporting along with the trust factor that is involved in the reporting in regards with stakeholders. Apart from this we will also be discussing the types of stakeholders they are who have their stake in the financial reporting of the company and why they have those stakes.

Discussion

Many times it has been well said that: The financial accounting information in the management of a company, properly analyzed and interpreted is the basis of every good decision, means that the financial executive must make decisions and therefore needs sufficient and timely information. By joining the financial statements standards or accounting principles, these states serve basis for making judgments on firm and for a sufficient analysis and interpretation of accounting and financial information that you corresponding result.

A company has historical financial information and future events that have interrelated elements. To find these relations, it is necessary to perform an auscultation of the information, which is to apply a range of techniques and procedures of mathematical type. Following the analysis we apply our personal opinion and practical experience in order to make a diagnosis about the financial position, results and projections of the company, similar to that done by a physician to interpret the clinical analysis of his patient. All this is in order to know if the financial structure is balanced, if the funds involved are the convenient, if capital investment projects have been properly applied, if the third-party claims related to stockholders' equity in Finally, a number of arguments that are useful to regulate the roads should continue to focus.

By analyzing and interpreting the analyst studies and discovers what they say or try to say the financial statements for the benefit of those interested in them. The financial analysis is often intended drawing conclusions about the future development of an activity, based on their past behavior. The most common is the credit risk analysis based inter alia on the examination of the financial statements of the requesting client, for one or more corresponding periods. This seems normal: It is assumed that a certain economic-financial function to behave a certain way in the past, will continue behaving the same way in the future and yet this is one of the most discerning and demanding analytical ability of the analyst, because the past is not always a good indicator of the future and it is precisely in those cases where the financial analyst's contribution becomes more valuable.

Stage 1

Criticism of Stakeholders

Among the stakeholders investors criticized the financial reporting and according to them the accounting practices used by the organization were confusing and this reason why investors lose confidence in the companies. The financial experts reported that investors ...