The purpose of financial reporting is to provide valuable information to benefit economic decisions (Financial Accounting Standards Board, 2008). Knowledge reflects the financial impact of transactions to operate a capitalist system. A business enterprise will compare the statement to determine long-term economic growth opportunities (Association of Chartered Certified Accountants, 2013). The report will include accurate details to reveal ethical issues, which influence the balance of accounting policies in the presentation and dissemination of information for public use. Venture capital firms rely on mandatory disclosure of financial statements specified in Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting System (IFRS) (Gibson, 2013). The goal is to gain knowledge to create good judgment and provide harmony because accurate financial statements create effective communication across boundaries. Ethics Various organizations maintain a stable financial position to obtain short-term investments. According to Investopedia (2014), profit comes from the surplus of stocks and bonds, which earn high-level dividends instead of a standard interest-bearing account. “The Dangerous Morality of Earnings Management” illustrates the direction of ethical behavior of corporate managers to influence financial statements to the benefit of managers or the organization (Bruns & Merchant, 1990, pp.1). The participants' belief is changing the rules of business methods, which are accounting, cost deferral, and budgets to alter short-term income. The individual neglects to extend credit and work hours to increase shipments or sales of goods to maintain profit (Gibson, 2013). The intention is ...... half of the document ...... ement Accounting, 72(2), 22. Retrieved from http://search.proquest.com/docview/229746269?accountid=38569Federwisch, A (2014). Ethical issues in the financial services industry. Retrieved from http://www.scu.edu/ethics/practicing/focusareas/business/financial-services.htmlFinancial Accounting Standards Board. (2008). Statement of Financial Accounting Concepts No. 1 Objectives of Financial Reporting of Business Enterprises. Retrieved from http://www.fasb.org/cs/BlobServer?blobcol=urldata&blobtable=MungoBlobs&blobkey=id&blobwhere=1175820899258&blobheader=application/pdfGibson, C. H. (2013). Financial Reporting and Analysis: Using Financial Accounting Information (13th Edition). Mason, OH: Southwest Cengage Learning. ISBN 13: 9781133188797Short-term investments. (2014). In Investopedia. Retrieved from http://www.investopedia.com/terms/s/shortterminvestments.asp