You are the chief financial officer of a small corporation, and the date is December 31 You recently asked the new accountant to prepare the initial draft of the financial statements for your review However, when you receive the draft, you quickly notice that no adjusting journal entries were made ...

Under the accrual basis of accounting revenues are record ...

You are the chief financial officer of a small corporation, and the date is December 31. You

Question:

You are the chief financial officer of a small corporation, and the date is December 31. You recently asked the new accountant to prepare the initial draft of the for your review. However, when you receive the draft, you quickly notice that no adjusting journal entries were made.
Required
Write a short memo explaining the importance of adjusting entries and the potential misstatements that can result from their exclusion.
Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...