An objective of financial reporting is to reflect economic information concerning a company's cash flows.

Question

Quizplus · Accepted Answer

One of the objectives of financial reporting is to provide information about a company's cash flows. This is achieved through the statement of cash flows, which presents information on the inflows and outflows of cash during a specific period. Reflecting economic information about a company's cash flows is seen as important because it can help users of financial statements assess the ability of the company to generate cash and meet its obligations.

An Objective of Financial Reporting Is to Reflect Economic Information