The U.S. Securities and Exchange Commission has issued a reminder to company management, auditors, audit committees, and their advisors that investors increasingly deserve and demand full transparency of accounting policies and in company annual reports.

The SEC says that the selection and application of a company’s accounting policies used when preparing annual reports must be appropriately reasoned.

It also stated its intention to consider new rules during the coming year to elicit more precise disclosures about the accounting policies that company management believes are most “critical” to the portrayal of a company’s condition and results, and requiring management’s most difficult, subjective or complex judgments.