Who are the main users of Financial Statements

David McGuinness
Flashcards by David McGuinness, updated more than 1 year ago More Less
David McGuinness
Created by David McGuinness over 4 years ago
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Flash cards on users of Financial statements

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Who are the main users of Financial Statements THE MAIN USERS 1. Investors & potential investors 2. Lenders 3. Other Creditors OTHER USERS 4. Employees & Trade Union Representatives 5. Government 6. Suppliers 7. Customers 8. The Public 9. Management & Competitors
1. Investors & Potential Investors f94f24e9-9ee0-4b4b-bcd7-37ef718ca1bd.png (image/png) Investors are interested in the potential profit and the security of their investment.
2. Lenders 09aa969a-88ff-4942-acc4-6ca1a8c5d44b.png (image/png) They need to know if they will be repaid. This will depend on the solvency of the company.
3. Other creditors 1277fc20-5cd5-4ddc-a687-51308d4da349.png (image/png) Suppliers and trade creditors require information that helps them understand and assess the short-term liquidity of a business.
4. Employees & Trade union Representatives 30cbf0a8-14de-4c54-948b-aa3440706802.png (image/png) They need to know if the employer can offer secure employment & management.
5. Government 8ecdbcb0-b592-4820-b2f3-abaae1d0ada1.png (image/png) Agencies need to know how the economy is performing in order to plan financial and industrial policies.
6. Suppliers 2fef4710-c66f-4c7b-b821-a960ade0ba9b.png (image/png) They would like to know if they will be paid. Also potential new suppliers may like reassurance of the financial health of the business before supplying goods.
7. Customers b8b556fe-9044-428c-90b0-b750a46c8292.png (image/png) They would like to know if the company can supply them in future. Especially if the customer is dependent on a company for specialised supplies.
8. The Public b8b9017c-8bed-4c8f-8819-011547de4801.png (image/png) They may wish to assess the effect of the company on the economy, local environment and local community
9. Management & Competitors 4e851a8c-b36e-4679-8f9a-c8690d9bc8fa.png (image/png) They would use the Financials statement of the business to make economic decisions. (however, they would mainly use monthly management accounts as their main source of financial information)
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