Question: The process is the same and GAAP requires that we prepare statements annually even when the operating cycle is longer. One of the reasons for
The process is the same and GAAP requires that we prepare statements annually even when the operating cycle is longer. One of the reasons for this is that a prime consideration is the comparability of financial statements, regardless of industry.And, to make this easier, we often make arbitrary decisions, like depreciation, to make the process reliable for a professionally trained accountant.
Why would we want to remove judgment calls?
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