Accounting Practices Assignment. Accounting, Finance, SPSS Essay

Accounting Practices Assignment
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Accounting Practices Assignment
The book “The End of Accounting and the Path Forward for Investors and Managers shows the extent to which the current financial reports have become useless in guiding capital market decisions. The author details the continuous deterioration of the financial documents and how they have lost relevance to the investors’ decisions. Investors in the modern world do not rely on these records while making investment decisions because they understand the circumstances and manipulations that the documents have undergone. The book presents the reasons why accounting is becoming less relevant in the modern society. Rather than just identifying a problem, the authors present a solution, which is known as the Value Creation Report. The new model of reporting focuses on the value that an organization creates through its business model that incorporates various organizational factors, such as capital, operating expenses, performance, and results. The new system was necessitated by the changing accounting landscape in the business sector. Unlike in the past, where accounting computations only focused on predictable variables, the modern business environment features unpredictable variables that can alter a business landscape and hence company performance.
The lessons taught and the reading provides valuable insights on the factors that shape the accounting sector and how the field is evolving. New challenges have to be countered by new strategies. Because of the unpredictable nature of the business challenges, which is characterized by sudden and unexpected events such as the Coronavirus pandemic, accounting systems have become less reliable as predictors of organizational performance. For example, in the past, there was less competition. Consequently, businesses focused on reducing manufacturing costs because market prices were already pre-determined and hence they...