Financial Accounting Theory – An Overview
Financial Accounting is both the art and science of collecting, recording and compiling financial information into precise formats. The purpose of this is to communicate this financial information to the end users in an efficient and effective manner. Financial accounting theory provides the theoretical concepts and rules that guide accountants to create useful financial documents to a number of end users. The usefulness of financial accounting theory is to assess the financial health of a commercial or non-commercial enterprise – Financial Accounting Theory Assignment Help
For the financial documents to be useful to the intended end users, it is essential to present this financial information in an accurate and consistent manner. Moreover, this financial information needs to be complied within a certain period in order to make important financial decisions. Financial accounting theory provides both the guidelines, rules and concepts necessary for the compilation of financial information. It provides the essential assumptions on which accounting methods and practices accrue and accumulate.
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