Accounting Police: Do They Exist?
Who created accounting principles? Who sets and revises accounting standards? What if you donĀ't follow all the rules, do you go to jail? Is there an accounting police force that investigates and arrests violators? It would seem that there must be some regulatory force to make sure that providers of financial statements conform to the rules. There is, up to a point, and here is how it works:
Mainly, itĀ's all voluntary and it works pretty well. First, double-entry accounting originated in Italy in the 1400Ā's, so its been around awhile. Accounting principles have evolved over the years just as have accounting standards. The reason why the system works is that the business community could not function if the...
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