Financial Decision Making: Role of Financial Accounts and Scepticism

This discussion post addresses the significance of financial accounts and professional skepticism in financial decision-making. It highlights the role of financial accounts in providing relevant data and supporting tools, such as past data trend analysis, for informed decisions. The post also emphasizes the importance of professional skepticism in ensuring the reliability and accuracy of financial information, as a lack of it can erode stakeholder trust and lead to biased reporting. It further discusses how profit-seeking companies often prioritize profit maximization, which is measured by increasing revenue and optimizing costs. The post underlines the critical role of accounting professionals in providing true and fair information to stakeholders, thereby enabling sound investment decisions. It also references academic sources to support its arguments, underscoring the penalties for failing to adhere to professional skepticism.

Dear Ri,
The concern of yours is off the mark and it is a question that every accountant in the
working in the country has to consider while performing their obligations. The
accountants of the company have the role and responsibility according to which they are
required to perform the obligation under the professional code of conduct and if these are
not followed then it can lead to severe offence against them. the professional scepticism
is defined through the standards. Hence, the question here arises why it matters the most,
as this impacts the nature of service and the goodwill that is professionally provided by
the accounting profession. This is critical as if the professional scepticism is not followed
then it would lead the company and the stakeholders of the company lose confidence in
the accounting professions (Atrill and Mclaney, 2014). As a result of the company would
be based biased due to which the correct and the accurate information is not made
available to the user of the report. This is important for the professionals to apply as they
are the person who provides the true and fair information about the company to the
stakeholders due to which the investors are able to take the decision of investing in the
company. If the professional scepticism is not followed by the professional then there is
severe penalty that is defined for this purpose due to which they can lose their
professional degree. Hence this is important for the accounting professional to follow the
professional scepticism while auditing the financial performance of the company.

Reference
Atrill, P. and Mclaney, E., 2014. Accounting and finance: An introduction. Pearson
Higher Ed.