Financial reporting refers to:
A)The application of analytical tools to general-purpose financial statements.
B)The communication of financial information useful for decision making.
C)General-purpose financial statements only.
D)Ratio analysis only.
E)Profitability.

Question

Quizplus · Accepted Answer

Financial reporting is the process of communicating financial information that is useful for decision-making purposes. While it involves the preparation of general-purpose financial statements, it also involves other forms of communication such as management discussion and analysis, annual reports, and other disclosures. Financial reporting also includes the use of analytical tools such as ratio analysis, but it is not limited to this aspect. Profitability is only one aspect of financial reporting and does not encompass the entire process.

Financial Reporting Refers To