Accounting Discussions Questions

Accounting Discussions Questions
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What is the importance of the mission of the FASB?
The Financial Accounting Standards Board (FASB) is mandated to establish accounting standards applicable in the preparation of financial statements in the private sector. The mission is to “establish and improve standards of financial accounting and reporting that foster financial reporting by nongovernmental entities that provides decision-useful information to investors and other users of financial reports,” (FASB, 2014 ). Thus, the mission is important to non governmental organizations as there is clarity on the accounting standards applicable under treatment of different accounting items. This in turn ensures that there is uniformity as there is a single authority responsible for clarifying accounting standards and principles applicable for US non government entities.
The mission of FASB is important for education and guidance of the public and users of information including investors and auditors. Through issuance of technical bulletins and interpretations, people get to learn more about the reporting requirements related to accounting issues. It is important for users of financial statements to understand the accounting principles and standards relied upon to avoid misinterpretation. Hence, the FASB plays a critical role in sensitizing users of financial information on how the accounting framework is utilized to solve existing accounting problems. Additionally, the FASB sensitizes users of financial information on emerging issues affecting accounting, particularly auditors, accountants and tax lawyers.
What is the importance of Ethics in Accounting?
Professional ethics and moral judgments are important in account, as accountants typically have access to sensitive information. Sensitive information should not be disclosed to unauthorized persons, as unethical accountants can damage a client business through disclosure of such information. Essentially, ethics helps to uphold integrity when holding client financial information. Thus, ethics play an important role in maintaining client trust with adherence to generally accepted principles and ethical practice being beneficial to the integrity of the accounting profession. The accounting profession would suffer bad reputation if account...