Enron Financial Statement Case Essay

Accounting is all about pecuniary learning capturing it, recording it, configuring it, analyzing it, and steming it to persons who use it. The financial teachings The final product of financial accounting is in the form of financial statements that are packaged with other(a) information in a financial floor. Financial statements are nimble at the end of each accounting period. A period maybe one month, one quarter, or one year. Financial statements report compend amounts, or totals.There are three main financial statements The vestibular sense sheet containing Assets and source of Assets at a specific date The income statement representing is the all- eventful financial statement that summarizes the profit-making activities of a personal credit line over a period of time. The Cash flow statement presents a summary of the businesss sources and uses of immediate payment during the income statement period. Financial brood Financial comprehend Form Financial Report must b e prepared accord to the Standards of generally accepted accounting principles generally accepted accounting principles for preparing the financial statements, these rules permit election accounting methods for some transactions. Furthermore, accountants have to interpret the rules as they apply generally accepted accounting principles in actual situations. The devil is in the details. The point is that interpreting GAAP is not cut-and-dried. M whatsoever accounting standards leave a lot of jiggle room for interpretation. Deciding how to account for certain transactions and situations requires seasoned view and careful analysis of the rules. Furthermore, many estimates have to be made. Financial Report main componentsThe three basic financial statements income statement, balance sheet, and statement of cash flows. A statement of changes in owners equity (if needed). Disclosures mainly containing Footnotes and the most important footnote is the one which identify the major accou nting policies and methods that the business uses and justifying any change in the policy used. Independent attenders report must be done by independent (from the firm) licensed auditor and give the business a clean bill of health, or that the report is misleading and should not be relied upon. This negative, disapproving audit report is called an contrary opinion.