diction and recently there has been a trend showing assets in public accounts at a valuation rather than at a historical cost.Another short-coming of the balance sheet is its monetary expression. Little information can be drawn out of it on the enterprises' activities, the profit of certain investments or managers' decision, the success of new products, the company employees. It would be impossible however to show all of these in one-sheet summary.As I have early pointed the balance sheet itself is a contradictory document also because of the various needs of its numberous users and environments in which it is used. The activity in which the organization is involved can have dramatic effects on the classification of an asset. What might not be an asset for one business would be an asset of another business, undertaking a different activity. Apart from these cases, which are to some extent reasonably clear cut, the activity can have dramatic effects on the difficulty or otherwise of drawing up a balance sheet. Consider for example the problems of a football club, trying to account for star players; or of a high technology business, trying to decide whether the cost of the patent on a new product is going to yield any future benefit when the state of the art is changing so rapidly.There are also issues related to the ways in which a business is perceived and the ways in which the management would wish the business to be perceived. For example a research has shown that the management, especially the management of smaller organizations, perceive that the bankers are interested in the amount of assets available as security for a loan or overdraft. There is therefore a temptation to try to enhance the value of assets perhaps by revaluing the land and building prior to applying for a loan. Similarly in a number of cases where a business is in trouble the assets have been revalued in order to bolster the image of the business and to promote th...
