Intermediate Accounting (16th Edition)

Published by Wiley
ISBN 10: 1118743202
ISBN 13: 978-1-11874-320-1

Chapter 1 - Financial Accounting and Accounting Standards - Review and Practice - Questions - Page 22: 17


Through his statement, the chairperson of FASB was indicating that; too much time was spend on the bottom line and not enough on the development of quality products. He was emphasizing that managers should be less concerned with short-term results and be more concerned with the long-term results. additionally, short-term tax benefits usually lead to long-term issues. The statement was also pointing out that, accountants are overly concerned with following a set of rules so that is litigation ensues, they will be able to argue that they followed the rules to the latter. the major issue with this approach is the fact that accountants want more rules with less reliance of professional judgement . The truth is that less professional judgement leads to inappropriate use of accounting procedures in difficult situations.

Work Step by Step

Additionally, in the accountant's defense, recent legal decisions have imposed vast new liability on accountants. the concept of accountant's liability that has emerged in these cases is broad and expansive.
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.