In order to attract shareholder investment a company must convince potential shareholders that it is worth the investment. This will usually mean that a company’s financial statements should show that the company is profitable and is going to remain profitable. This will encourage the potential investor to believe that attractive financial returns can be gained from such an investment. Given that all investments of this form are a risk to investors, we need to ensure that even though risky, the financial statements of a company do not mislead. How do we ensure that the financial statements of a company are produced in a way which most accurately reflects the fair presentation of the company’s position?