With respect to SPFR, ASA800 requires 'true and fair' reporting. Learn more
Generating financial reports on 'cash basis' could not be considered as presenting fairly in all material respects. Consider an entity that has accumulated an increased trade creditor position of $100,000 over a reporting timeframe. If the cash basis profitLoss report shows a profit of $50,000 the true profitloss position of the entity is actually $50,000 loss!
Imagine a bank lending monies on the basis of a cash profit with no visibility over the trade liabilities of the entity. This is a legal case waiting to happen and the accountant will wear the outcome.