Undoubtedly, accounting is one of the key roles for a business to be successful. In the article “Tesco’s accounting problems – No so funny”. The author discusses the case of Tesco’s overstated first-half profit by 250 million pounds and has now wiped 4 billion pounds from the troubled grocer’s stock market value.The purpose of accounts is for external stakeholders to aid evaluative judgments, such as the firm’s ability to pay suppliers or financiers. As a result, accounting requires to be honest and transparent. From Teco’s example, it is clear that the false accounting of Tesco had created Tesco in a series of investigations. The problem of accounting did not just caused Tesco’s future business plan, as they are not sure of what actual profits they are earning. Moreover, harms Tesco’s brand image and investor’s confident to invest Tesco. Therefore, Tescos has lost one of its source of finance.However, I think that sometimes it is inevitable for a business to have inaccurate accounting. In this case Tesco claims the main problem is “underreported the costs of stolen and out-of-date produce.” As a result, I believe that Tesco can decrease their annual revenue by a percentage. And the percentage can be based on historical data of the missing stocks. By this way, it maybe able to make the account to be more accurate.

All in all, from Tesco’s example, we can see a clear case of how important accounting is to a business operation. Consequently, for any firm they should have a good accounting report for the business to be successful.