For each of the following independent situations, identify the relevant objective(s) of financial reporting that the company could be overlooking. Discuss each of these objectives.
1. The president of Coventry, Inc., believes that the financial statements should be prepared for use by management only, because they are the primary decision makers.
2. Cascade Carpets Co. believes that financial statements should reflect only the present financial standing and cash position of the firm and should not provide any future-oriented data.
3. The vice president of Share Enterprises, Inc., believes that the financial statements are to present only current-year revenues and expenses, not to disclose assets, liabilities, and owners’ equity.
4. Cruz Co. has a policy of providing disclosures of only its assets, liabilities, and owners’ equity.
5. Marty Manufacturing, Inc., always discloses the assets, liabilities, and owners’ equity of the firm along with the revenues and expenses. Marty’s management believes that these items provide all of the information relevant to investing decisions.