HI6025 Accounting Theory and Current Issues - Conceptual and critical evaluation of theories

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Part A

The corporate disclosure practice will help all the stakeholders to understand and measure business operation. Annual financial statement and particularly income statement is one of the most important ones. However, a company's reported profits will be impacted by different factors, including when particular transactions and events are recognised and how such transactions and events are measured.

Requirement:

  1. Using earning management concept, discuss why the timing of recognising events that impact income, revenue or profit or expenses are important for managers?

"Maximum 1000 words."

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