Theory Base of Accounting · Class 11 · CBSE · Commerce Accountancy
What is the primary objective of adopting Accounting Standards?
Practice question from Theory Base of Accounting (Class 11 · CBSE · Commerce Accountancy), with the correct answer and a step-by-step solution.
medium · MCQ · Q-18B9A1
What is the primary objective of adopting Accounting Standards?
- A.To eliminate the need for an external auditor
- B.To ensure transparency, consistency, and comparability of financial statementsCorrect answer
- C.To guarantee that a company will never face bankruptcy
- D.To reduce the tax liability of corporate entities
Solution
Accounting Standards are policy documents issued by expert accounting bodies to harmonize accounting policies and ensure uniformity, transparency, and comparability across different enterprises.
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