Question

The main objective of financial reporting is:

A

to provide useful information for decision-making.

B

to produce financial statements as quickly as possible

C

to provide only relevant information

D

all of the above

Financial information must be a faithful representation of the economic reality of the events. Faithful representation is achieved when the information is:

A

complete

B

neutral

C

free from material error

D

all of the above

Answer 1

Solution 1:

Main Objective of financial reporting to provide useful information for decision-making to management and to investors.

Also financial statement help to prepare other financial statements like cash flow statement is depend on balance sheet and ration analysis is also taken the help from financial statements.

So Financial statement is help in decision making, produced other financial statements and provide only relevant information’s only.

As per the above explanation,

Answer = Option D = All of the above

Solution 2:

Financial Statement must be fully complete, Free from material error and neutral it means if we are checking information from financial statement than this should be complete information of about the company and there is no error in the financial statement

Answer = Option D = All of the Above