Many people wonder why the idea to
regulate accounting is becoming so
popular. Due to past experiences with
manipulating accounting figures, it is
no wonder that accounting has been under
so much scrutiny. This is the reason why
so many people feel it is time to
regulate accounting, due to so many
companies not abiding by the rules set
forth. Because of the many negative
incidents that have occurred with
different scandals and schemes, there
has been a lot of mistrust form the
public in the accounting field. To
regulate accounting, will give
confidence back to the public. Here are
some of the benefits that will arise
when we set higher standards to regulate
accounting.
A majority of the public feel that
accountants are working in the interest
of their own company and the companies
that they work for, instead of working
to inform the public properly. When you
regulate accounting, this prohibits any
company and accounting firm to hide the
truths about the company and its
financial status form the public. The
regulation of accounting, will force
companies and their accountants to be
more open and straightforward about
their financial dealings and show their
true financial situation.
When you regulate accounting, it will
play an important role in the stock
market as well. There are many mixed
feelings about investing in publicly
traded companies, because of the
capabilities to hide a companies
financial distress. If you regulate the
accounting laws, then it will lower the
chances of a company being able to
manipulate any financial reports shown
to the public, which is a dilemma that
has happened in the past.
When you regulate the accounting laws,
you will hold corporations and public
organizations responsible or their
actions. This is a very important part
in regulating accounting practices. With
tougher laws in place to prevent fraud
and to prevent special favors, the
public will be safer against fraud. To
regulate the laws, will let not
accounting firms and businesses alike,
aware that they will be held accountable
for their actions. Not only will this
give confidence back into the accounting
field, but it will also deter fraudulent
activities in the accounting industry
due to the strict consequences.
The most important reason to regulate
accounting laws, is to protect the
public. Whether it is a publicly traded
company, or a company that gains a
majority of investments form its
workers, both alike need to be protected
form fraudulent activities. This is very
important and is why the government has
leaned to regulate accounting and its
laws and practices. It has been proven
by past experience, to not have strong
accounting guidelines in place and
enforced, only leaves room to lead to a
disastrous result.
There are many mixed feelings regarding
the ideas to regulate accounting.
However, despite the mixed opinions, the
idea to regulate accounting is strong.
It is not only the responsible thing to
do, but it will also safeguard the
public form companies and fraudulent
activities that could occur. To not
regulate accounting laws and practices
will only leave room to gather more
mistrust in the accounting.
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