The most general and most important objective of financial reporting is to:A. Provide useful information for decision makingB. Ensure management objectives are metC. Safeguard the company's assetsD. Keep information summarized, simplified and condensedReset Selection

Answered: most general and most important…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

The most general and most important objective of financial reporting is to:
A. Provide useful information for decision making
B. Ensure management objectives are met
C. Safeguard the company's assets
D. Keep information summarized, simplified and condensed
Reset Selection

Expert Solution

Evaluation of options

Option B is wrong because ensuring that the management objectives are met is not an objective of financial reporting. Financial reporting is more focused towards the needs of external users of the organization.

Option C is wrong because the safeguarding of the company's assets is the duty of management. It is not the objective of financial reporting.

Option D is wrong because keeping the information summarized, simplified and condensed is the duty of the accountant while preparing financial reports. But, it is not the objective of financial reporting.