Part 1
Financial reporting entails the production of financial statements which disclose the financial status of a company to the interested parties. Usually, financial reporting targets the external stakeholders, such as the shareholders, potential investors, customers, government employees among others. However, financial reporting is also used by the management of the organization to improve the corporate governance. Shareholders are extremely interested in the financial status of a company. The investors need to understand how the company is making an effort to maximize their wealth and create value from the resources they have injected into the company. Such information can only be ...