Question

The accountant is aware that some members of the Board of Lisbon have little understanding of accounting, and he is worried about his presentation of the financial statements at the Board meeting. How should he deal with this situation?

a) Proceed with the presentation as planned, assuming the Board will catch up.
b) Prepare a simplified version of the financial statements to enhance understanding.
c) Skip the financial statements and focus on non-financial aspects of the report.
d) Reschedule the meeting to allow time for accounting education.

Answer 1

The accountant should prepare a simplified version of the financial statements to enhance understanding.

Step-by-step explanation:

The accountant should deal with this situation by preparing a simplified version of the financial statements to enhance understanding.

By presenting the financial statements in a simplified manner, the accountant can make the information more accessible to the board members with little accounting understanding. This may involve using clear and concise language, visual aids such as charts or graphs, and focusing on the key financial metrics and trends.

By taking this approach, the accountant can ensure that the board members have a better understanding of the financial statements and can make informed decisions based on the information presented.