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Regulatory Guidelines towards proper accounting statements

According to me the following are some of the steps required for proper Accounting Statements.

  1. INTERNAL MANAGEMENTS:- Entire administration should be in the hands of Professional and accountable Persons. They should be made responsible for any irregularity in the area of their administration for Eg. Manufacturing section headed by Cost Accountants, Marketing headed by MBA with Marketing, Finance & Accounts by Chartered Accountants,
    etc.,.Internal Management should be made more strong, accountable than relying on externally appointed persons. Their opinion can be used as Guidance only.
  2. AUDITORS:- The management should not be allowed to appoint the auditor for the following reasons since the loss incurred to the organization in not the loss only to shareholders but also it effects the following areas: –
    1. Waste of resources.
    2. Loss to creditors, financial institutions.
    3. Loss to customers, distributors, dealers.
    4. Loss to employees due to loss of employment.
    5. Loss to suppliers or raw materials.
    6. Loss to government as a whole.
    7. Loss to industry as a whole.
    8. Loss to image and goodwill of the group.
    9. Loss to investor’s confidence at large on corporate sector.
    10. Loss to net wealth of the company.
    11. Loss to productivity.
    12. Loss to quality.
    13. Loss to development as a whole.Therefore all the auditors should be appointed on employment basis only.
  3. COST ANALYSIS:- Every Organization should appoint a Cost Analyst who will guide the organization after analyzing the information obtained from the organization for giving proper guidance for Cost reduction, improving productivity, waste reduction etc.,. This appointment also should be on empanelment basis only.
  4. MANAGEMENT INFORMATION SYSTEMS:- Standardization formats, Standardized information should be passed on compulsorily to the management at regular intervals. The information should be correct & comparable. For wrong information the punishment must be severe.
  5. SUPERVISION:- The top management should regularly supervise the internal management and information systems and any deficiency should be plugged. PLACEMENT:- Every placement has to be made according to Qualification & Experience
    only. Correct person at correct place with correct powers will give the best results.
  6. ACCOUNTABILITY:- The responsible person should be able to be identified at every stage from top to bottom. So that he can be made responsible. Accountability should be at all levels whether lower or higher.
  7. PERFORMANCE:- At every stage the performance of organization as a whole and individual constituent has to be analyzed so that the inefficient will be substituted.
  8. CAPITAL PROPORTION:- The top management should be asked to have controlling capital contribution. So that they feel pinch of the loss, enjoy the fruits of the gain.
  9. POLICY DECISIONS:- Policy decisions and objectives to be achieved are to be decided at the top level of management like the Board of Directors which should be asked to be followed at all levels of management & at lower levels.Overall, the internal management should be made more responsible & accountable for the success or failure of the organization.
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