The Directors ask the Chief Financial Officer What is this year's final profit?, the CFO...

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The Directors ask the Chief Financial Officer " What is this year's final profit?", the CFO replies "What would you like it to be?". a) Describe three differing examples of where the Directors of a company can use their judgement to impact the profit and loss account of that company. [3 marks] b) Describe five mitigants or controls to that use of judgement, and how they limit the discretion of Directors to impact the profit and loss account. [10 marks] c) In your judgement, explain whether you think the mitigants are sufficient to ensure financial statements are fairly prepared. [2 marks] The Directors ask the Chief Financial Officer " What is this year's final profit?", the CFO replies "What would you like it to be?". a) Describe three differing examples of where the Directors of a company can use their judgement to impact the profit and loss account of that company. [3 marks] b) Describe five mitigants or controls to that use of judgement, and how they limit the discretion of Directors to impact the profit and loss account. [10 marks] c) In your judgement, explain whether you think the mitigants are sufficient to ensure financial statements are fairly prepared. [2 marks]

Answer rating: 100% (QA)

Profit of the year will be calculated from the statement of Profit and loss account It is also known as an income statement Here the statement what is this years final profit and what would you like t... View the full answer