Overview of Accounting
Introduction
One of the most significant tools, or pieces of information, available to managers today is business data such as financial statements and managerial reports. If there is any decision worth making in business, it is worth making it with the appropriate data to back it up and base it on. Oliver Wendell once said, 'The significance of facts is more important than the facts themselves, and if accountants know the significance, people may even forget the facts' (Coleman, 1949, 1). One of the most valuable services that accounting can give to management is to help accomplish their objectives by preparing and interpreting essential data. Financial statements and managerial reports are most often used by accountants to share pertinent facts that may be useful when the time to make important decisions arrives (Coleman, 1949, 1).
Audiences, Purposes, and Natures of Financial Statements
Managers, CEO's, business owners, and other high end officials who make major decisions for their companies, investors, potential investors, creditors, anyone with a stake in the company, or anyone who whishes to put a stake in the company are the chief audience for financial statements and managerial reports. These reports provide information that is useful to present to these groups so they may make informed decisions regarding the company. The principal qualities that make this information useful are relevance, reliability, comparability, and consistency. The aim of this information is to introduce the aggregated results of a company's transactions as they truly are, as opposed to how someone would want them to be (Beresford, 1990). Fudging the figures could mean the fall of the company, and is illegal bes ...