ancial reporting the accurately reflects the financial position of a publicly-traded company as a going concern, the future prospects of the company, and the public disclosure of information that may affect with of these factors. The SEC develops accounting regulations designed to assure that the financial reports of publicly-traded companies satisfy these objectives. The IRS, however, focuses in the federal income tax liability of taxable entities. The IRS develops accounting regulations the intention of which is to assure that federal income tax liability for specific periods is correctly determined. It is possible that a company that prepared financial reports based only on SEC accounting regulations or only on IRS accounting regulations would risk failure to comply with the accounting regulations of the other
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