Final answer:
The Full Disclosure Principle requires complete information in financial statements, ensuring transparency for users like investors and regulated by the SEC.
Step-by-step explanation:
The accounting principle that mandates that financial statements must furnish complete information about the company, requiring the disclosure of all relevant details, is known as the Full Disclosure Principle. This principle is critical to ensuring that all necessary and relevant information is made available to the users of financial statements, such as investors, creditors, and regulators.
The Securities and Exchange Commission (SEC) plays a key role in enforcing this principle, particularly through the requirements established under the Federal Securities Act. It is through robust disclosure requirements that a level of transparency is achieved, helping to reduce the issue of imperfect information, where market participants do not have equal knowledge about a company's potential future earnings.