List and explain 5 users of accounting information
Although the press doesn't use financial information for its decision bases, it does report on the financial information of companies.
Financial accounting provides information for external users.
What to know more about gaap?
Investors in hd tune pro 5.50 crackserial key general want to assess the value of a company in order to decide whether it is worth buying, selling, or holding their stock.Unlike company management or internal users, external users of financial information are not directly involved in running the business or organization.Networks like Yahoo Finance and MSN Money are multi-million dollar businesses that simply report financial information about other companies.Users of accounting information.In other words, external users need financial information about companies in order to support their financial decisions.Companies trading.S.It might sound unlikely, but many customers study financial statements before making major purchases.The processed information is reported through standardized financial statements.Investors read financial statements to help predict future performance and company worth.Financial accounting aims to provide all of these groups with information that can be useful for them in their individual decision making processes.
Although these principles work to improve the transparency in financial statements, they do not provide any guarantee that a company's financial statements are free from errors or omissions that are intended to mislead investors.Here is a list of the most common external users of financial information and how they use.For example, if a customer orders 100,000 units from a supplier, the supplier wants to know whether the customer will be able to pay for these units before the supplies incurs the expense of producing them.The iasb and the fasb have been working on the convergence of ifrs and gaap since 2002.Exchanges had to provide gaap-compliant financial statements.If a financial statement is not prepared using, gAAP, investors should be cautious.There is plenty of room within gaap for unscrupulous accountants to distort figures.There are many different users of accounting information and the users may be inside or outside the organization.Also, management needs the accounting information to evaluate the performance of the organization and position, so that the necessary measures may be taken to bring improvements in terms of business results.Employees - Employees use the accounting information to find out the financial health, amount of sales and profitability of business to determine their job security, the possibility of future remuneration, retirement benefits and employment opportunities.