Types of information ?

When you read the accounting information, What type of information do you need?














User

Types of needs to accounting information

Investors/shareholders

-      Assess how effectively the managers are running the business.

-      Assess the ability to pay dividends.

-      Make decisions to buy, hold or sell ownership shares of a company.

Lenders

-      Evaluate the risks of granting credit or lending money.

-      Assess the ability to pay interest and repay the amount borrowed.

Suppliers and other trade creditors.

- Determine whether amount owned to them will be paid when due trade creditors are likely to be interested in an entity over a short period than lenders unless they are dependent upon the continuation of entity as a major customer.

Customers

-      Know if the company will continue to honor product warranties and support its products lines specially for long term plans.

Competitors

-      Compare performance

Employees.

-      Know about the stability and profitability of their employee

-      Assess the ability of entity to provide remuneration, retirement benefits and employment opportunity.

Governments, tax authorities, regulatory agencies.

-   Determine and assess taxation policies.

-   Calculate national income and statistic

-   Decide whether financial support is needed

-   Tax authority need to know whether the company complies or not. To calculate how much should they pay.

-   Regulators need to know whether the company is operating or not.

General public

-   Entities contribute to the local economy in many ways including number of people they employ and their  positions and salaries.

 

 



Comments

Popular posts from this blog

Staff authority

Answer for example (1)