Reference no: EM132436464

Respond the below statement.

Financial Analysis and Reporting

200 words and reference:

Statement 1:

A company's financial statements contain a breadth of information that often requires interpretation and further analysis by users. Naturally, accounting is a complex skill and understanding the underlying accounting practices and policies of a company can require extensive knowledge. An aspect of US GAAP compliant financial statements which is pivotal towards understanding the accounting policies of a company is the notes to the financial statements. The notes to the financial statements are important for a number of reasons. With this, the notes to the financial statements are important because they disclose information that may not be found elsewhere in the financial statements, they describe the accounting policies utilized by a company, and they detail subsequent events which can have an effect on the company being reported on.

Statement 2:

200 words and reference:

Financial statements are meant to simply show values for the different accounts and activities for a company as of a certain date, but the preparation of them are more complex than meets the eye. Various accounting methods have been selected to determine how a company performs their valuations. As an outsider reviewing the financial statements, it's difficult to determine those methods or analyze the statements in more detail without additional information. This is the importance of the notes to the financial statements. The main purpose of the notes is to supplement the information found on the face of the financial statements.

Attachment:- Financial Analysis and Reporting.rar