Financial statements and accounting information misaligned with the Venezuelan reality

In relation to the financial risks generated by revenues from sales in foreign currency, these can cause negative consequences to the organization, and produce effects to the organizations the risks for revenues in foreign currency.

Financial statements and accounting information misaligned with reality, indebtedness, inadequate decision making, reduction of production, decapitalization, penalties. Basically, financial statements and accounting information mismatched with reality, consists of presenting information that is not real, false or misleading information that lacks validity or comes from unreliable sources and is disseminated with or without intention.

Financial Statements in our country seem to have any utility, except for what the International Financial Reporting Standards indicate, which is timely decision making since the Venezuelan economy has suffered from hyperinflation in the last 36 months.

And this situation affects the basic financial statements (Statement of Financial Position, Statement of Income and Statement of Cash Flows), since the local monetary unit is so volatile that it impedes the analysis and comparability of the financial statements.

In addition, the maintenance of the accelerated inflation rate in our economy together with a continuous devaluation of the bolivar in relation to stable currencies (hyperinflation - megadevaluation) has impacted the fact that transactions of economic operations occur in terms of foreign currencies instead of the local currency.