However, the 2018 Conceptual Framework has cut this back to just three key groups. C) Users of financial information have different information needs.? External users have limited authority, ability and means to access the required information. In this report six different users of financial statements will be identified.

Although different users have different interests in business, the conflict can mainly be solved by the general-purpose and standardized format of financial statements.

Moreover, the conflicting needs of users and limited information provided in reports might cause potential users cannot find information useful to them (Atrill and McLaney, 2008). users of financial statements Question 1 Which of the following is true about the users of financial statements??? Analysis and calculations of relevant and specific financial information will be performed to reflect the performance of the company, and how this is seen by the different stakeholder groups. Users can be seen more as hypothetical readers of financial statements than as actual users, because they need particular types of information (Young, 2006). Financial statements are divided into two main categories which are general and special purpose financial reports.
An income statement helps external financial statement user decide basing on prediction. Users of Accounting Information may be internal or external to the organisation. The older conceptual frameworks identified groups such as government and general public as primary users. D) Users of financial information are most …

To obtain updated performance reports and decisions of the board of directors, external users can access the websites of companies. Each user group will be described and the reasons why they use financial statements will be examined. Turning to the special purpose financial reports which are usually required by lenders, government and creditors. As for the general purpose financial reports, the major users are owners, shareholders, managers, customers, the general public and so on. There are various different users of financial statements, each with different information needs. Internal users (Primary Users) include management, employees and owners whereas external users (Secondary Users) include creditors, tax authorities, investors, customers and regulatory authorities. External users, on the other hand, are not involved in the operations of the company but hold some financial interest. B) Users of financial information have the same information needs.? The external users may be classified further into users with direct financial interest – owners, investors, creditors; and users with indirect financial interest – government, employees, customers and the others. The external users of financial statements use these statements to determine whether it is worth investing in a specific company. A) Users of financial information can control the information they receive.? Looking at these statements, eternal users are able to determine whether a company is worth investing into (Jensen, 2009). They have to rely on the financial statements and annual reports, auditor’s report and directors’ report etc.

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