Module 1 Assignment 1
The financial Reporting Environment
All companies today work based on financial reports that are totally necessary for some aspects.
Making our reports to the government is one of them, but one of the most important is when it
comes to investors, when we need to borrow from the bank or when we have a project to
continue adding to the work. Entrepreneurs and managers have always been in the eyes of many
since for a long time they have experienced what is the alteration of reports, the optimistic
manipulation of them to attract attention and present the company in a more active way among
others.
The owners and managers of companies with the practice of using many times the money
invested by investors for their welfare and not for everyone in general and the different bad
practices opened the door to various regulations. Among all, it is important to bring the key
points of a report, the accrual accounting, the management responsibility and the accounting
conventions to offset manager’s optimistic bias. These are steps taken to protect everyone.The
