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Some of the items on the balance sheet are based on estimated information. Consider management’s responsibility...

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Accounting

Some of the items on the balance sheet are based on estimatedinformation. Consider management’s responsibility when it comes tothe use of estimates (e.g., net realizable value of receivables,valuation of inventories, accumulated depreciation, etc).1.Describe the incentives management has to misrepresent estimates.2.With the core value of integrity in mind, discuss controls andprocedures companies can put in place to prevent misrepresentationof these estimates.

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Management is responsible to estimate various amounts in the books of accounts The management must adhere to the accounting standards policies and principles while making estimates in the books of accounts The estimates must be made as per the accounting standards and policies Proper procedures shall be followed    See Answer
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