In addition to shareholders, many different parties are interested in the audited accounts of a company. Name FOUR such parties and state the significance...

      

In addition to shareholders, many different parties are interested in the audited accounts of a company. Name FOUR such parties and state the significance of audited accounts to each one of them.

  

Answers


johnson
i) Tax authorities: Audited accounts give a true picture of the entity?s profits and can be relied upon by tax authorities for the assessment of tax on the company.
ii) Lenders:- audited accounts are credible and therefore can be relied upon to assess the credit worthiness of the entity.
iii) Employees – Are interested in whether the entity is a going concern, which can be established from the audited accounts to ensure job security.
iv) Customers – those who rely on entity?s products are interested on whether the entity will be producing in future (going concern) or whether they ought to look for alternative suppliers
v) Potential/actual investors need to know whether investing in the company is worthwhile i.e are they bound to benefit financially in terms of dividends and capital gains.
johnson mwenjera answered the question on March 22, 2018 at 17:11


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