Accounting Information: External & Internal Users

May 2, 2010 by admin

 

Basically there are two groups of users who are utilising the accounting information in any organisation. They are the external & internal users.  So, lets take a look:

EXTERNAL USERS

• those who have financial interest in the reporting organisation.
• they are not involved in the day-to-day operations of the organisation
  • Owners
  • Creditors
  • Labour unions
  • Government agencies
  • Suppliers
  • Customers
  • Trade associations
  • General Public
• Each of the above groups requires unique information.
• For example; Government agencies may have an interest in whether the organisation meets certain benchmarks to receive grantt. Whereas, the general public may be interested in the extent to which the reporting organisation is socially responsible (polluting the environment, etc)

INTERNAL USERS

• every employee of the organisation uses internal accounting information.\
  • Board of directors
  • Chief Executive Officer (CEO)
  • Business unit managers
  • Plant / Branch managers
  • Store / Procurement managers
  • Line managers
• Each employee has different specific goals and objectives that are designed to help the organisation to achieve its mission & vission.