In this assignment, I will examine whether off-balance sheet information can be the main cause of violation of the financial transparency of companies' financial statements. More specifically, I will begin by analyzing the general purpose of financial statements by linking it to financial statement transparency. Additionally, I will critically discuss off-balance sheet information by giving a definition and examples of items that can be considered "off-balance sheet." Additionally, I will discuss the advantages and disadvantages of using “off-balance sheet” information in financial statements with reference to a UK case. In the concluding paragraph, my personal view will be given, based on the above research, explaining why and to what extent I agree with the particular comment. Traditionally, accountants have followed a financial statement objective. According to Alexander and Britton (1993): "The objective of financial statements is to provide information about the financial position, performance and changes in the financial position of an enterprise that is useful to a wide range of users in make economic decisions. A company's financial statements should have a positive impact on anyone who wants to clearly record each entry. As a result, investors or other users interested in economic decision-making are also interested in the transparency of financial statements. Financial transparency can be described as a clear and high-quality financial statement. Additionally, for businesses, transparency includes information that is visible and understandable to investors and anyone else interested in making economic decisions. Additionally, transparency plays an important role in...... middle of paper ...... companies today use off-balance sheet information in their financial statements. This results from the many benefits that off-balance sheet information can provide to financial statements. On the one hand, there are disadvantages to using off-balance sheet information. Through the Enron and Lehman Brother scandals, we can conclude that off-balance sheet information can only be a “benefit” for company managers. On the other hand, this can cause many disadvantages for everyone, even business leaders. Consequently, although off-balance sheet trading offers many advantages, we cannot ignore the negative effects. This undermines the financial transparency of companies’ financial statements. Therefore, financial transparency must prevail over the off-balance sheet in each company in order to have “healthy” and high quality financial statements..