Which of the following is not a rationale for regulating financial accounting information?
A) To protect users from fraudulent or misleading information
B) Market for information without regulation is inefficient, and may result in production of sub-optimal amount of information
C) To assist management with better information, and reports for use by management and parties within the organisation
D) To ensure equal access to information by all interested parties, including those that have limited power to demand it

Question

Quizplus · Accepted Answer

Regulation of financial accounting information is primarily focused on protecting users from fraudulent or misleading information, ensuring equal access to information by all interested parties, and promoting information efficiency in the market. The rationale to assist management with better information is not a justification for regulating financial accounting information as the duty to produce management reports and other internal reports falls on the organisation itself, rather than external regulation.

Which of the Following Is Not a Rationale for Regulating