Acca financial Accounting (FA) Study Text ac ca (FA)


Chapter 1  KAPLAN PUBLISHING



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Chapter 1 

KAPLAN PUBLISHING



 

 



Customers

 need to know that an entity can continue to supply them into 

the future. This is especially true if the customer is dependent on an entity 

for specialised supplies. 

 

The public



 may wish to assess the effect of the entity on the economy, 

local environment and local community. Companies may contribute to their 

local economy and community through providing employment and 

patronising local suppliers. Some companies also run corporate 

responsibility programmes through which they support the environment, 

economy and community by, for example supporting recycling schemes. 

Management and competitors would also use the financial statements of a 

business to make economic decisions. Management, however, would 

predominantly use management accounting information as their main source of 

financial information for decision-making. Competitors may also access publicly 

available information to assist decision-making in relation to their own business 

activities.  

Overall, users of financial statements need information which is relevant and 

reliable to help them to assess management’s stewardship of the resources 

which they control and manage. Financial information enables users to hold 

managers to account for their decisions and to enable users to make decisions 

about whether to invest in or provide other resources to a business.  

 

 




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