Objective of Financial Reporting

The overall objective of financial reporting is to provide information that is useful for decision making.


Specifically, the AICPA Financial Accounting Standards Board in its Statement of Financial Accounting Concepts enumerates the following objectives of financial reporting:

1. To provide information useful in investment, credit, and similar decisions.
2. To provide information useful in assessing cash flow prospects.
3. To provide information about entity resources, claims to those resources and changes in them.