Financial Reporting and Analysis I
Reading 20. Financial Reporting Standards
Learning Outcome Statements
a. describe the objective of financial statements and the importance of financial reporting standards in security analysis and valuation;
CFA Curriculum, 2020, Volume 3
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Subject 1. The Objective of Financial Reporting
The objective of financial reporting:
- The objective of financial statements is to provide information about a company's financial position, performance, and any changes in financial position; this information should be useful to a wide range of end-users for the purpose of making economic decisions.
- Financial reporting requires policy choices and estimates. These choices and estimates require judgment, which can vary from one preparer to the next. Accordingly, standards are needed to attempt to ensure some type of consistency in these judgments.
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To provide Information about a company's financial position, performance and its changes.