Basic Accounting Concepts and Business Structures

ACC 537 FINANCIAL ACCOUNTING

All businesses has a obligated task to prepare financial statements that shows the performance of the business at the end of a accounting period. Accounting standards regulation is important because it helps to ensure that companies are transparent in preparation of financial statements which reflects the true results of the company's outcome. If there are no regulations for preparing financial statements, anyone can prepare and present the financial statements to the public without considering credibility.

According to Financial Accounting Standard Board (FASB) the hierarchy of Generally Accepted Accounting Principles (GAAP) governs what constitutes GAAP for reporting entities. It lists the priority...