| Description |
Financial reports have constantly become more technical and difficult for the informed user to understand. The four statements and detailed footnotes included in the financial reports provide the necessary financial information for investors and creditors to evaluate the financial stability of an enterprise. Because of the great importance attached to these reports, they must be complete and concise and relay the most pertinent details in a meaningful manner. Any unclear, ambiguous information must be clarified. One statement in particular has been criticized for the confusion that users experience due to the form and style of presentation of the information. This statement, the Statement of Changes in Financial Position must be simplified to better provide the necessary information to the user. In addition, new and important comparative information must be given to supplement an analysis of past and present trends in the flow of funds. This project summary offers an example of how the statement could be modified to portray the information to best meet the needs of the user. Information contained in this study was obtained from interview, class discussion and in-depth research. The conclusions outlined can be effectively used and applied in current practice to eliminate the problems of the Statement of Changes in Financial Posit on as currently presented. The result of such a change in form and style would benefit investors, creditors and consequently the enterprise itself due to the better informed decision making of all parties involved. |
