Question: You know that both internal and external users have not only the short-term success, but also the long-term success of the company at the forefront

You know that both internal and external users have not only the short-term success, but also the long-term success of the company at the forefront of their minds. One way that users determine short-term and long-term success is by use of the Balance Sheet. On the Balance Sheet a user may look at Retained Earnings along with the portfolio of assets displayed and compare that to the liability side of the Balance Sheet.

What are the major limitations of the balance sheet as a source of information, and how can your role as an accountant ensure that the information presented does not include errors? How would you support your claims?

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Balance Sheet The purpose of the balance sheet sometimes called the statement of financial position is to report a companys financial position on a particular date Unlike the income statement which is ... View full answer

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