The notes to the financial statements are integral. The first note, for example, spells out significant accounting assumptions. We can value inventory several ways for example, and in the notes we can see if the company uses Last-In-First-Out (LIFO) or First-In-First-Out (FIFO). This is important because LIFO generally lowers taxes by lowering income. Two companies that perform identically will have different net incomes if they use different methods. Which is why, generally within an industry all companies use the same methods.

Why would a company look to the industry standards when making accounting choices?

With a reference please, thank you.