Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 24 - No. 30)
What are the consequences of omitting adjusting entries?
Incorrect financial statements.
Misleading financial analysis.
Non-compliance with accounting standards.
Reduced tax liability.
Explanation
Omitting adjusting entries leads to inaccurate financial reporting, making it difficult to properly assess the company's performance and financial position. It also goes against generally accepted accounting principles (GAAP).
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