Accounting distortions arise from the nature of accrual accounting.

Name: Accounting distortions arise from the nature of accrual accounting.
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Accrual accounting requires estimates and assumptions to be made, which can lead to distortions or inaccuracies in financial reporting. Examples include the recognition of revenue before it is actually received, the estimation of future expenses, and the use of subjective judgments in determining the values of assets and liabilities.

Accounting Distortions Arise from the Nature of Accrual Accounting