1. Explain why each of the following concepts is important in relation to financial reporting to markets and other economic agents that rely on such reporting: 

a. Economic entity assumption 

b. Historical cost basis of accounting 

c. Faithful representation 

d. Generally accepted accounting principles 

e. Professional ethics of the accountants and/or auditors involved in producing financial statements. 

2. How have each of these concepts been incorporated into the financial statements of a large public company you know about? Give specific examples. 

3. Now apply these ideas to a small private company, such as your local Thai takeaway, newsagent or pharmacy. Are these concepts still relevant? Why or why not?