• Home
  • Subjects
  • Finance & Accounting
  • If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice

If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice - Essay Example

Only on StudentShare

Extract of sample
If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice

Any organization in the market has to ensure that it chooses the correct accounting policy in order to attract more investors. The investors usually have interest in studying the financial situation of the company to allow them make an effective marketing decision. Insightfully, this means that the choice the company makes will affect the reflection and recording of financial statement to the investors. Consequently, the earning management by a company highly depends on the accounting policy that a firm uses in showing its financial position. Discussion The switch between FC and SE, as accounting methodologies, depend on the reasoning that one capitalizes while another expenses the cost. Successful Efforts refers to the methodology where the unsuccessful exploration cost is expensed and usually integrated as part of the income statement. However, Full Cost involves capitalizing the unsuccessful exploration cost meaning that this cost is not part of the income statement in this case. The choosing of the two alternative methods relies on their effectiveness in achieving transparency related to the accounting information about oil and gas company’s earnings and cash flows. Based on the Successful Cost method, the objective of an oil and gas company is to produce oil or gas from its reserves hence the view that only the costs related to successful efforts are capitalized. ...Show more

Summary

Name Professor Course Institution Date Market value and change in accounting policy Introduction The main purpose of this study is to determine how the choice of accounting policy, a firm makes in the market, can affect its market value or earning management…
Author : abigaylekuvalis
If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice"
with a personal 20% discount.
Grab the best paper

Related Essays

How has marriage reflected the changing status of women in Australian culture in the past century
She has seen periods where she was discouraged to work outside the home, yet her work inside the home was not deemed valuable to society. She has been oppressed in bad marriages, yet had little recourse to leave. Finally, she has seen a period where she has entered the labor force, therefore has money of her own, and this, in turn, has made her less beholden to the man she married.
8 pages (2000 words) Essay
How Modernism is Reflected in Short Stories
This paper analyzes the short stories in the context of modernism. Modernism refers to things and actions that take place during the modern period. The three stories, which have utilized symbolism to pass out messages about modernism, show that modernism has both progressive and retrogressive effects on human life and the society.
7 pages (1750 words) Essay
Relationship between finance and accounting, and how they operate to determine financial viability within a health care organiza
These two functions are normally interconnected that it is easy to mistake that they are similar (Bruce & Kristin, 2006). However, this might be a misconception that this paper will strive to dissolve. This clarification will be done by highlighting the independent components of the two that distinguish them from each other.
3 pages (750 words) Essay
If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice
This study will use a case study from Lev Baruch’s essay in the Accounting Review Volume 54, No.3 p485-503 which is a study of the oil and gas industry’s reaction to change in accounting policy. This study aims at investigating the effects of accounting policies on market value of firms and investor decisions.
6 pages (1500 words) Essay
Choice of Accounting as a Career
According to the report a change in markets of China, Japan or India directly impacts the markets of United States and the UK or frauds in United States can directly cause market turbulence in the entire world due to large amount of global business. Continental Europe primarily due to inflated financial reporting to showcase aggressive earnings management.
30 pages (7500 words) Essay
What are the implications of differences between reporting by IFRS and US GAAP reporting by UK Investment banks and US GAAP reporting by US investment banks
tates companies abide by the Generally Accepted Accounting Principles, while in Europe companies abide by the International Financial Reporting Standards. The utilisation of each of these frameworks affects the information contained within them. This proposal studies the effect
16 pages (4000 words) Essay
How has marriage reflected the changing status of women in Australian culture in the past century
She has seen periods where she was discouraged to work outside the home, yet her work inside the home was not deemed valuable to society. She has been
8 pages (2000 words) Essay
If accounting policies only determine how past transactions are recorded and reflected in financial reports, how can the choice of accounting policy influence the market value of a firm
This case forms the basis for carrying out research on whether accounting policy may influence the value of a firm. Any organization in the market has to ensure that it
6 pages (1500 words) Essay
Financial Accounting Reports
The major distinction between financial accounting and managerial accounting is that while the purpose of financial accounting is the provision of information to people outside the organisation, the purpose of managerial accounting is meant to help managers make
4 pages (1000 words) Essay
Financial Accounting Reports
These statements are provided to general public outside the company and the main receivers of the information included therein are generally for the stockholders/owners. Certain
8 pages (2000 words) Essay
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT