Paper 2

Question 1

Purpose of final accounts for different stakeholders

Answer 1

Shareholders: To understand where money in the business is going and coming from and to help educate on whether they should purchase, sell or hold their shares.
Employees: To see if the business is performing well enough to assess the grounds for a pay rise and do assess their job security based on the financial position of the business.
Managers: To judge the operational efficiency of the business. Useful for target setting and strategic planning/