Use of Financial Accounting Systems in Firm’s Valuation

Abstract

In this study the utilization of financial accounting systems in the valuation of firms is evaluated as indicated by the case of Samsung Company. The results creates the indication that the accounting systems of information implementation within the corporation has led to the improvement its valuation. This has been accomplished through creating better strategies to make decisions, internal control and the financial reports quality that has thus facilitated the corporation’s transactions. The results additionally indicated that the process of evaluating performance has also been developed.

Acknowledgement

First, is to thank God for the power and strength of participating in the program and the capability to achieve my spiral objectives.

The completion of this research necessitated the assistance, support and guidance of several people to whom I would like to express my deep acknowledgement and appreciation as for them the complexity of the project was just an assumption.

I would like to utilize the opportunity to thank my project’s supervisor …… for his extensive support and guidance throughout the complete study preparation. The realization of this project would not have been acquired without his comprehensive and undying support and his encouragement that made this masterpiece to be a success.

For his particular special guidance as well as the unaccountable advice in doing the research and the extreme diligent in evaluating, issues, text chapters, concepts, exercises and solutions that paved the means in the formulation, preparation and the implementation of the research project.

I cannot forget to thank all the individuals particularly, colleagues, friends and family who offered their undoubted guidance throughout the textual development and the collection of data. I therefore express my sincerest appreciation for the professional and positive attention offered a great production procedure.

Introduction

Inquiry Overview

Financial accounting reports plays a primary role in the valuation of business firm in the modern economic sector today. For the organizations managers it is therefore important to understand the association amid accounting data and values through the integration of the valuation theory and the practice of evaluating financial statements (Nilsson, 2015). In addition there are several alternative accounting based financial valuation models and they demonstrate the relation amid accounting variables to the returns and prices of stock (Walton & Aerts, 2006). The objective of every firm whether it is based on profit or not is to produce maximum shareholder’s value. The objective of creating increased value is additionally achieved best when there are suitable mechanisms of monitoring financial management operations. Financial accounting is useful in such evaluations through offering reliable, relevant as well as timely and accurate data to the firm’s shareholders.

For most individuals financial accounting is considered to be the business language and thus business cannot evaluate success without the application. The general significance of financial accounting reports for the objectives of valuation cannot be doubted. The effectiveness and the relevance of financial accounting reports to the firm’s lenders, investors and creditors is a concern that is expressed in differing degrees on normal basis (Bebbington, Gray & Laughlin, 2001). In that financial accounting system tens to release outdated information since the data are collected for a specific period and most of the firm’s managers have already acquired means through which they can forge the accounting numbers so that the personal objectives can be achieved.

Problem Statement

In the global economic sector accounting systems are the major drives of organizational performance. The use of effective accounting systems leads to the generation of positive performance while weak systems lowers potential and the general business performance (Meitner, 2006). Corporation’s such as Samsung operate in the global setting and thus the use of the financial systems of accounts affects their performance in general. This is because they are mainly considered to the economic development determinants based on their extensive operations. In addition they are not limited to either stock or financial resources and therefore adapting suitable systems of accounts and the relevant application is useful for the business. However, not all managers that understands the usefulness of these systems and the right applications. Most organization lacks the application of updated systems of accounts and even though they are updated and properly installed the utilization cannot be categorized as perfect. The systems therefore utilizes poor technologies and the lack of qualified and knowledgeable system application affects the general valuation process. This has therefore led the researcher in conducting a detailed study on financial system of accounting use on the valuation of a firm, its effectiveness and how it compares to other models that are mainly based on value in reference to Samsung Corporation. After the assessment of the issues faced by corporations in the implementation of financial systems of accounting and other value based valuation models recommendations will be formulate for improved decisions to be embraced.

Aims and Objectives of the Study

The study’s objectives will be alienated into two parts that is the general as well as the specific objectives.

General Objectives

This research project is particularly designed to provide analytical information in regard to the use of financial accounting systems in firm’s valuation, its effectiveness in valuation and how it has impacted Samsung company valuation.

            Specific Objectives

1. To investigate the use of financial accounting information in a firm’s valuation
2. To establish whether financial accounting systems are effective in valuating firms
3. To establish the relational amid financial accounting systems and other alternative valuation models that are accounting based.

            Research Questions  

1. What is the use of Financial Accounting Reports in the valuation of a firm?
2. Is the Financial Accounting System effective as a valuation model?
3. How does Financial Accounting System compare with other alternative accounting based models of valuation?

            Literature Review

            What is financial accounting system?

            Financial accounting can be described as a customized accounting branch that maintains the company’s financial transactions tracks (Nilsson, 2015). With the utilization of standardized measures the financial transactions are particularly recorded, analyzed after summary and presented through financial reports also known as financial statements like balance sheets and income statements. Financial statements are offered by corporations on routine basis and the statements are accounted to be external since they are presented to individuals outside the firm and the primary recipients are the stakeholders and a number of lenders (Nilsson, 2015). If the stock of the firms however traded publicly this implies that the circulation of the financial statements tends to be extensive and the information can be obtained by secondary receivers such as the employees, consumes, competitors, investment analysts and labor corporations.

            A financial accounting system can be described as an integrated financial system of accounting that monitors, records and maintains all the financial and accounting transactions. The system mainly accumulates the reports and processes of the system in regard to the performance of the entity which includes profits and loss its position financially with an inclusion of shareholder’s equity, liabilities or assets and the financial position changes (Hooke, 2010). Financial system of accounting inputs includes transactions of business that are supported completely by document sources like board resolutions, invoices, memos management and so on.  The inputs are normally processes with the utilization commonly accepted principles of accounting and the processed data is then reported through financial statements that are standardized. The objective of financial accounting statements within the organization is not to make report of the company’s value rather the objective ids to offer adequate information for other individuals to make assesses of the company’s value individually.

            What is Valuation a Firm?

            The valuation of the firm refers to the procedure of establishing the current assets worth or the corporation with the utilization of several techniques. When an analyst is placing a specific value on the corporation it check at the firm’s management, the capital structure composition, the potential future earnings and the assets market value (Mercer, Harms & Mercer, 2008). The security of the market value is determined by the willingness of the buyers to make payments to the buyer in assumption that the transaction was voluntary. When this security of the exchange trades, buyers and sellers established the value of the market.  Intrinsic value concept is however perceived as the value of the security that is grounded on future earnings. This is the procedure of a company’s valuing assets for the purposes of financial reporting.

            Valuation models

Simply, a firm’s model of evaluation is the channel with sets procedures and processes that are utilized in the determination of the general worth of the business. This requires the adoption of different measures. Some of the approaches utilized in valuation include;

• Asset-based approaches
• Earning based approaches
• Market value approaches

There are numerous reasons as to why businesses should be updated one being the need for equity financing to facilitate expansion, increase shareholders value and form grounds through which the business can be sold. However, regardless of the rationale, the general worth of the business particularly depends on different forces from the existing economic state through to the financial statements within the corporation. Samsung Corporation has consistently worked on maximizing its values through increased sales and market expansion which is effective in raising the shareholders shares within the given market (Lunt, 2009).

Asset Based Approaches

In short the approaches under this valuation methodology totals all the business investment which can be conducted on the grounds of liquidation of an ongoing concern. This involves the listing of the general net worth of the business based on the assets value and them making specific subtractions from the liabilities value.  The liquidation approach is utilized in the determination of the net flow that can be acquired given that all the possessed assets have been sold while the liabilities are all pad. Asset grounded approach is more beneficial for Samsung corporation since it is not a sole business and thus the shares for all the investors can be determined at ease. In such a corporation all the involved assets are fully owned by the corporation and in normal cases they would be incorporated in the business sale.  Assets within the corporation exists in the possession of the shareholders and they are all utilized for business operations. This is unlike sole business which possess most challenges in the attempt of separating the personal as well as business utilization (Warren, 2017).

Income Value Approaches

These approach of valuation a business makes their predictions regarding its general values through the thought that the actual value of the business lies in the general capability to generate adequate wealth in the nearest future (Warren, 2017).  The most utilized income value strategy is the utilization of capitalization past the stated income. With this methodology, the existing value is determined through the expected cash flow level for their corporation that utilizes the incoming generation records, normalizes them for the uncommon expenses and those makes the multiplication of the anticipated normal flows of cash from sales through the capitalization force.  The capitalization force can be determined as the general reflection of the general return rates that a reasonable purchaser would make anticipation on the made investment as well as the general risk measure that the anticipated earning may not acquire. This can additionally be achieved through discounted future income rather than the use of the average past income this approach utilizes the average of the predicted future income trend thus making divisions with the capitalization force (Warren, 2017). For Samsung which has been in existence for an extensive period it is usually easy to make bot future as well as the past income valuation since its  consumer loyalty is  connected directly to the quality of the  products that are offered within the specific market  rather the ownership of the business operations unlike sole proprietorship.

Market Value Methods

Firm’s valuation with the utilization of market value strategies is the attempt to seek to establish the business value through making comparison of the business and similar others that are sold in the recent. This approach normally works best for the global corporation that exists in competitive surroundings since it normally necessities an adequate number of firms that are similar with the business so that the valuation can work best (rucco, 2015). The assignment of value to the business that is owned by a sole operator on the grounds of market based valuation is challenging. From the definition sole ownership involves businesses that are owned individually and thus this can be challenging to find prior sales data from the public surrounding of such a business which may result in misinterpretations and inaccuracy. Despite that for most large corporation income value strategy is the most commonly utilized approach in valuing a business most corporation’s works with a combination of several approaches as the fairest strategy. Franchise agreements normally develops strategies and description of how the business can be sold but this approaches varies from one vendor to a different one (rucco, 2015).

The Use of Financial Accounting Information in Valuing Samsung Company

Financial accounting system is utilized by Samsung Corporation in the collection, storage as well as financial processing and the accounting of data that is then utilized by those that make decisions.  Samsung Corporation is from the origin of South Korean as a multinational conglomerate that is headquartered in Seoul in Samsung Town.  Samsung group  that is commonly referred to as Samsung is a multination technology and innovation company that is involved in the designing, formulation and the sales of electronics such as  phones, computers, laptops, computer software’s as well as online direct services (rucco, 2015). Some of the electronic products that have performed well in the market includes the Galaxy products  which holds similar features as those made by the competing companies such as Apple Inc. Android Kit Kat, lollipop and marshmallow are some of the effective software’s in the market. These software’s are utilized by most of the large corporation in the manufacturing of smartphones which acts as the revolution center in regard to technological development (rucco, 2015). Samsung is considered to be among the leading market leaders in the application of software’s and the manufacturing of innovative products within the enterprises market (Warren, 2017). This software’s are useful to other corporations in the fighting of the destructive  implications  of complexity  that prior electronics held  and this creates fresh opportunities  for development and innovation  and thus positioning the corporation well in  sustaining their competitive advantage.

Accounting information within the corporation is normally utilized to improve the general efficiency as well as the effectiveness in maximizing the generation of income within its market. In addition the system is objected at strengthening the corporation’s internal control through offering adequate funding to control the general operations (rucco, 2015). In addition through the financial reports the corporation is able to make sound decisions and thus determining specific objectives to be attained to sustain its competitive advantage within the market. This strategy is essential to the corporation since it helps in lowering the redundancy risk, assist in the generation of a working surrounding that is efficient, offers more knowledge regarding operations within the market and helps in solving the barriers of trade and of currencies based on its operation in the international markets which are normally challenged by fluctuation of currency. The strategy is however expensive since it normally involves the outsourcing of valuators in all its markets and it is located in differing markets which makes it hard to achieve efficiency.  In addition the strategy requires to be conducted within the varying of periods rather than any time that  it is required which may end up generating  data that can best be categorized as outdated as it may not be adequate in positioning the firm competitively. The electronics market is one that is characterized by intensifying competition based on the fact that it hold some of the largest companies globally and they are well established in the market which requires the adoption of differing approaches every time and this may also be challenging if the acquired financial data does not help in establishing the positioning of the company and what should be done to solve the issue through the adoption of strategic objectives (rucco, 2015). The company’s financial accounting valuation is normally based on the value of its market.  Income statements are utilized in the presentation of data on the income results of the firm’s activities over a certain period.  This statement reports demonstrates the much of revenue that is generated by a corporation over a time period and the general cost that is incurred in relation with the generated revenue. Through the company’s cash flows report information that regards its cash payments and receipts is retrieved during the whole accounting period and therefore shows how the specific laws of cash are connected to the ultimate cash balance to that of the statement that was present in the beginning (rucco, 2015).

Samsung Corporation is one of the most valued corporations globally. The statement is grounded on its value within the international market which was roughly 400 billion dollars in the last financial year (Porter & Norton, 2009). Despite the fact that markets are bound to experience fluctuations sometimes even in increased gaps it no wonder that Samsung among other corporations such as Apple have survived the challenge and marinating their respective leading positions. Its value market value in the last financial was greater in a huge gap as compared to the competing and the following companies. The company has ceded its leading location and benefits on most occasions but the most crucial is that through its innovation it has been able to sustain a positive position. In making the determinations of the much that a company can be paid the valuation is not done on mere estimations rather the investors normally rely in the documented financial and accounting data that are released on public trading by the corporation (Porter & Norton, 2009).

Accounting is considered to be the business language because it offers detailed data in which the managers, shareholders and the potential investors can utilize in evaluating the general performance of the company. Factually the primary objective of the use of financial accounting in the company’s valuation is to assist the investors in making decisions that are informed in particular. Financial accounting is the one that is full responsible for the general  preparations of the firm’s financial  statements that  includes owner’s equity statement, income statement, cash flows and balance sheets statements that offers a summary of the company’s past performance thus evaluation the existing  financial  situation (Porter & Norton, 2009). If a corporation is involved in public trade on markets that deals with stock like NASDAQ this implies that the statements are normally displayed publicly (Porter & Norton, 2009). This differs with the management accounting which is mainly objected at assisting managers in making solid decisions. Financial accounting implies that the statements have to be in adherence with the accounting principles and this is normally essential in enhancing accuracy. Financial accounting is utilized to establish whether the corporation created any kind of profit thus furnishing other data in regard to the financial situation of the company. Through the  created information  the owners and managers of the  company  are able to utilize the report  in taking  corrective actions  despite that the information  generated  by management accounting  provides  deeper levels. Through the statements the creditors as well as the investors furnishes all the funds that are required by the corporation in operating and also understand how the business works. Continuous investment decisions is conducted on the grounds of evaluating the general performance. In addition financial accounting is normally utilized by other users such as consumers, employees and suppliers (Porter & Norton, 2009). The respective suppliers for instance needs to understand whether the corporation that they make their inputs ales to is being faced with the challenges of paying their expenses or there is a risk of sinking. On the other hand the employees and any involved labor organizations are normally interested since different compensation forms and salaries are reliant on the performance of the company (Porter & Norton, 2009).

The statements normally accounts for the total of the sold goods and the general expenses of operation in exemption of the sold goods. The distinction amid the general sales and the cost of the goods that have been sold is normally regarded as gross profit. On the other hand the net earnings of the company is established through subtracting the operating costs from the gross margin. Balance sheets are utilized in making reports regarding liabilities, assets as well as the equity of owners. For Samsung similarly to their corporations financial statements are prepared on the basis of a year (Porter & Norton, 2009).

Effectiveness of Financial Accounting System

A system of financial system can be an authoritative tool in reference to the investors of a business.  The effectiveness of the system is mainly acquire when the needs of the corporation are considered. The system is more time, accurate and reliable as compared to other models as it utilizes the effectiveness of credits as well as the existing debits in the conversation of data into a structure that communicates the actual interactive and personalized information regarding the company. Through the provision of feedbacks on the performance of business this generally allows the control of the result (Porter & Norton, 2009). Though financial accounting the company is able to determine the amount of money in the bank. This presents opportunities through which even the transactions whose recording has not been done is acquired that includes deposits, and prior authorized payments which may not be seen manually. This recording allows the conducting of a thorough evaluation which is useful in the prevention against unpermitted and mistaken transactions. In addition this helps in the determination of the much owed by consumers, owed to suppliers and the general cost of operation. This helps in determining the much that the business generated from sales and the available inventory (Porter & Norton, 2009).

A well formatted and designed financial accounting method is essential to corporations wellness as this helps in the provision and the identification of the areas that can be useful to the corporation in saving costs for instance the need to make less expenses on specific items and renegotiate products with the suppliers, lower the charges of the bank by acquiring either greater or reduced quantities and the general consideration of the respective strategies of lower (Porter & Norton, 2009). The implementation of financial accounting systems within corporations helps in the facilitation of improved ability to make solid and informed decisions, increased internal management, facilitating the corporation’s financial transactions and reliability of all the financial statements. Finacial accounting systems involves the general transactions recording and the compilation of report. One of the primary significant accounting information benefit over all other kinds of information is mainly the fact that it is grounded on numbers. The statistics in the reports are so straight that they demonstrate what is present by showing the presence of losses of benefits (Stickney, 2010). A primary objective of accounting information is the fact that it is highly objective and it is based on the highly embraced principles of accounting. The application of these rules during the preparation of the reports helps in creating comparable as well as standard data. All the data that is utilized in the financial system can be categorized as verifiable data which is not based on desires or opinions and this makes accounting information not to be grounded  on biases. In addition accounting information is characterized by increased reliability for instance if the data indicates that the corporation owes a certain amount of debts this implies that the amount is the one that is required in payments. Any questions in regard to a certain subjects can be answered through reviewing the reports which demonstrated the calculation of numbers (Bhattacharyya, 2011).

So that any form of data can be included in the financial statements it has to be made of as form of sense by having adequate documents as backups. In accounting department that holds proper running reconciliations are usually made and the involved processes are in a place that assures both information accuracy as well as reliability (Stickney, 2010). Accounting information reports can usually be analyzed in the provision of financial  information to the management  that can utilized  in effective running of the  business, make some plans and additionally place changes if the business begins to head in the direction that had not been anticipated. In that if the general sales of a certain product can be categorized as  low which differs with the developed expectations the accounting statements are utilized  in demonstrating the particular reality  and through this the management the management is able informed decisions in its regard which is an apparent benefit of the accounting information effectiveness (Stickney, 2010).

The system is additionally characterized by speed and structured classification of data that creates efficiency. The speed of processing data is influenced by the classification of data in that data is utilized in forms of classification and can thus be utilized in the compiling of more detailed and well-structured statements (Stowe, 2007). If any calculation necessitates some revision this offers an easier way of doing it by directly addressing the specific data of concern. Classification allows the users to understand the reports at ease since it eliminates the complexity that is presented by all other approaches such as income based and market value that normally classifies items in general and the need for correction of a certain sector may imply that the whole calculations have to be redone. Through the recording of the respective data safety is enhanced since the data can be reused in the future since these results are considered to be regular backups that are reliable in making future predictions (Stickney, 2010).

Financial Accounting System That Samsung Uses To Value Their Firm Compared To Other Alternative Accounting Based Valuation Models.

In comparison to other accounting valuation strategies financial accounting utilized tends to be more effective as compared to equity valuation and the earning valuation models. The earnings model of valuation which is commonly known as abnormal income valuation approach is a methodology that is utilized in determination of the worth of the company that is grounded on the earnings and the value based on the books (Zhang, 2014). This model is more residual based since it looks on the decisions of the management on whether they have resulted in better or poor performance. The model normally states that investors should make higher payments given that the income is higher as compared to the general anticipation. The value of the corporation from other models is settled for after making comparison on the competitors. However financial model is more objected at establishing the position of the company in an individual nature to establish whether the company’s worth is adequate as anticipated (Stickney, 2010).

On the other hand equity valuation is mainly purposed at estimating the company’s value. The model is driven by the assumptions that any company’s security is influenced by the significant aspects of the corporation that underlies the conduct of business in any given period.  These model utilizes three different approaches which are cost cash flow discount and the comparable methods (Nasev, 2009). The basic comparable method approach is that the value of equity should reflect to differing equities that are under a similar classification. The valuation is normally achieved through making comparison to the general worth of the competing firms within the market. This also differs with financial accounting that is utilized by Samsung which is valued based on its market value rather than making comparisons with the rivals. The differences obtained within the equity value strategy is utilized in demonstrating the present chances. This strategies are mainly based on opinions as well as assumptions by making comparisons with the worth of firms in the same sector and thus they are not as accurate, timely and reliable when being compared to financial accounting. Finacial accounting is mainly grounded on facts and the most suitable data in making conclusion regarding the company’s value (Stickney, 2010).

3.0 Research Methodology

This section will provide a detailed analysis of the research method that was utilized for the dissertation. The chapter offers detailed outline of the study strategy, method, and data collection, and sample selection, process of research, analysis of data limitations and ethical consideration of the study.

Research strategy

The conducted research by the study was more of applied as compared to a fresh one in the context of financial system of accounting. The research utilized a systematic review of several pieces of academic research that had been conducted in a few years back in regard to the utilization of financial system of accounting in evaluating the firm specifically focusing on Samsung Corporation. In this context the research utilized a form of a study that is more of new but based on a research subject that has been in existence.

Research Method and Approach

So that the aims of the dissertation would be fully satisfied the research conducted a qualitative research. This approach mainly utilizes reduced samples to ensure that the results are both finite and quantifiable. This offers an advantage because it offers a comprehensive investigation and an analysis of the subject of research even without limiting the study’s scope and the responses nature (Tavakoli, 2013).

The study followed an inductive study strategy. Based on the theory of the approach the researcher starts with the basic subject’s observation which is then utilized in the generation of concepts and assumptions that are derived from the research. The approach was selected because it considered small samples and ensure that the context is followed so that qualitative information can be generated (Tavakoli, 2013). However the approach is characterized by major weaknesses since it generates generalized assumptions and concepts that are grounded on the low scope of observation thus creating inaccuracy which can be categorized as unreliable.

Data Collection Method and Instruments

The objective of the study was to investigate the use and the effectiveness of financial account as an evaluation model for a firm.  In this context after gathering data from the previous research detailed questions that comprised of both closed and open-ended queries was utilized. Interviews were not detailed since the participants are busy personnel’s but they help in the creation of direct connections. The use of this particular strategy was essential in the generation of maximum data which is well structured and directly supports the objective of the study. The structuring of the questions created both flexibility and the potential and accuracy thus creating a more reliable chance for creating assumptions (Tavakoli, 2013). The sample population was mainly chosen based on their knowledge in relation to financial accounting as a strategy for evaluation.

Ethical Consideration

The current study was particular subjected to a number of ethical concerns. Authorization has to be acquired from the firm so that the case can be based on its operations. In addition all the respondents made reports of their acceptance in regard to their responses in the study through a written and signed introduction and a consent form. In addition withdrawal was voluntary since the members were fully permitted to exit at any time without having any proper explanation. The responses were treated as confidence since the research was involved in the personal analysis of the data and ensured that sensitive information regarding the company is not published. The primary objective of asking for consent was to assure the respondents that the study was both confidential and voluntary and thus one would decide to participate or note. In addition the respondents were fully informed about the purpose of the study while asserting that their responses would also be treated confidentially and will only be utilized for academic operations without any commercialization.

Limitations

Similarly to other studies this study was faced with several limitations. To begin with the sample size was small in particular since it only involved the senior employees who were available to participate in an online survey. A large sample would have been essential in enhancing the study’s reliability. In addition the use of qualitative research failed to allow of some of the examined issues such as financial accounting flexibility. In addition the effectiveness of the use of financial accounting in valuing a firm may have been influenced by several other aspects that were not mentioned. In addition the participants were not willing to offer sensitive information in reference to their corporation. Time as well as cost were additional constraint since much of the time was to be utilized in acquiring primary data.

Data Analysis

Data acquired from primary sources such as the filling of online questionnaires and interviews was analyzed with the utilization of content analysis. The data was gathered in this nature so that it can be compared more to the other that was acquired from previous literature. The existing literature data was analyzed through the utilization of systematic review. This strategy of analysis is important because  it helps in the lowering of the of the length of the collected data through offering simplifications while still generating results that can be measured with the utilization of quantitative methods (Vogt, Gardner & Haeffele, 2012). In addition content and systematic evaluation offers the researchers the capability of structuring qualitative information that is gathered in the manner that satisfies the studies aims.  However, such strategies are normally limited by human errors since the data can be misinterpreted thus creating unreliable and untrue assumptions.

            Time Line

DISSERTATION AUTHORING STAGES	DAYS NUMBER	STARTING FROM	UP TO
FIRST-STAGE: Researching And Reading	3 days	1st  April	3rd April
Establishing a manageable concept to apply
Researching on the chosen subject
SECOND STAGE: formulation  of a plan	3 days	4th April	7th April
Creating a detailed dissertation plan
THIRD STAGE: Initial writing	7 days	8th April	15th April
Begin by drafting various sections of the study and the related concepts
Conduct thorough research where the necessity arises on understanding the issue
FOURTH STAGE: formulation of the initial draft	7days	16th April	23rd April
Compile the sections into the initial draft
Review the dissertation’s flow
Confirm the required research length
Conduct the needed editing and further research
FIFTH STAGE: last draft	7 days	24th April	30th April
Review to establish any errors
Submission preparation
Last editing and proof-reading
Compiling the references and bounding the dissertation
Submission of the last draft

Conclusion and recommendation

Evaluation of Findings

The findings acquired from the study can be categorized as accurate and also dependable. Through the study the findings supports the hypothesis that financial accounting is essential in the creation of competitive advantage through the utilization of statistical facts. In addition the data was acquired from reliable sources which were then evaluated on the grounds of their findings. The primary data that was gathered from the utilization of both questionnaires and interviews increased the general reliability by offering maximum and firsthand information that increased the general reliability.  However, the data acquired through systematic review is one that is limited to errors based on the fact that it can be said to be outdated and errors may have been incorporated in the review.

Recommendations & Conclusion

In summary, Financial accounting reports plays a primary role in the valuation of business firm in the modern economic sector today. All the firms are mainly objected at growing the value of the involved shareholders and therefore establishing its worth is essential. Finacial accounting is useful in establishing whether the corporation is headed to the anticipated direction. This system is very useful in the evaluation of accounting reports through its relevancy. The reports generated through the evaluation can then be utilized in the management and monitoring of the financial operations. For most financial accounting is the language of the business and therefore success of failure cannot be evaluated without its application. The importance of financial accounting can never be underrated. However financial accounting is limited because it only creates information that is outdated based on the time period required in creating these reports.

With respect to the above analysis it can be recommended that financial accounting is particularly effective while incorporated with other strategies such as income earnings of equality models in evaluating the firm. In that the worth that is established internally can be compared with that in the external surrounding. In addition the collaboration may be useful in the elimination of issues that are related to the information being outdated. This strategy can help the investors in making decisions that are highly informed thus increasing reliability as well as accuracy.

Appendices

Appendix 1: Financial Accounting Users

Khalid (2012).

Retrieved from:https://image.slidesharecdn.com/financial-accounting-120522225821-phpapp02/95/financial-accounting-23-728.jpg?cb=1337727680

Appendix 2: Accounting impact on profit

Zori (2011)

Retrieved from http://solomonzori.blogspot.co.ke/2011_09_01_archive.html

Appendix 3: Finacial statement analysis

Cambridge business (2013)

Retrieved from http://images.slideplayer.com/16/5258533/slides/slide_4.jpg

 

 

 

 

 

 

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