Difference between GPFRs and SPFRs - Essay Example

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Difference between GPFRs and SPFRs

On the other hand, SPFRs refer to financial statements created for businesses to be used by internal stakeholders such as management. SPFRs are more detailed than the GPFRs and can be created at the instruction of the management. The SPFRs can be created for any purpose unlike the GPFRs since they do not depend on regulations when producing them (Hunton 2006, p. 135). B. GPFRs and SPFRs for small firms and family Businesses A firm must produce GPFR regardless of whether it is a family firm or a small business. C. Regardless of the information required they must implement an accounting system to assess the financial performance, assess solvency and liquidity, provide information to the relevant parties, to understand the reasons for any changes, guide the management in the decision making process and control the operations, and to enable the management forecast the financial position and future performance. Implementation and utilization of accounting system based in reporting. D. The managers use accounting information in budgeting as per the business plan requirements and forecasting of the financial outcomes as well as managing the operations. This also helps them in the cost-volume-profit analysis for the business plan, breakeven analysis and in profit planning . Q2. 50 shareholder rule This describes the Securities and Exchange Commission (SEC) rule that specifies that companies with over 50 shareholders to register with SEC. ...Show more

Summary

GPFR refer to the financial statements that require production by all public companies.These include the revenue statements,balance sheets and cash flows.The production of GPFR depends on the Generally Accepted Accounting Principles …
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