Unit 1: Users of accounting information

*Internal users:

+Owners and managers: need information about the company’s financial situation as it is currently, and as it si expected to be in the future. This is to enable to them to manage the business efficiently and to make effectively decisions that affect ít continued operations.

+Shareholders of the company: want to asses how well the managements is performing. They want to know whether the company’s operations are profitable or not and how much profit they can afford to withdraw from the business for their own use.

+Employees of the company: should have a right to information about the company’s financial situation. They need these reports in making collective bargaining agreement (CBA) with the management, in the case of labor unions or for individuals in discussing their compensation, promotion....

*Extenal Users:

+Investors: make use of financial statement to asses the viability of investing in a business. Financial analyses are often used by investors and prepared by profesionals( financial analysts), thus providing them with the basis in making investment decisions.

+Financial institutions: use them to decide whether to grant a company with fresh working capital, to extend debts and other significant expenditures.

+Government and their agencies: need financial statement to define the propriety and accuracy of taxes and other duties declared and paid by a company. They also require information in order provide a basis for national statistics.

+The public: Media and the general public are also interested in financial statement for a variety of reasons.

*Passive Voice:

Simple Present

Somebody cleans this room  

 - This room is cleaned.

Present Continuous

 Somebody is cleaning this room.

 - This room is being cleaned.

Simple Past

 Somebody cleaned this room.

 - This room was cleaned.

Present Perfect

 Somebody has cleaned this room.

 - This room has been cleaned.

Simple Future

 Somebody will clean this room

- This room will be cleaned.