Question

External users of accounting informationare:
Researchers
Government
Potential Investors
All of the above​

Answer 1

ANSWER :

External users of accounting information are:

(i) Researchers

(ii)Government

(iii) Potential Investors

(iv) All of the above ✓

• External users of accounting information are : (iv) All of the above; i.e., Researchers, Government and Potential Investors.

MORE INFORMATION :

➱ Accounting is considered as an information system necessitat3d by the great complexity of modern business.

➱ Accounting information is generally used when a businessman applies for a loan from a bank.

➱ The accounting information are used for the purpose of analysing the present position and future prospects of an entity.

➱ There are a number of parties who are directly or indirectly concerned with the accounting information of an entity. The parties or user groups interested in accounting infornation maybe classified into two broad categories. These are :-

• (a) Internal Users : Internal users of an accounting information are the managers who plan, organise and run a business. Internal users include owner/proprietor, partners(in case of partnership firm), marketing managers, production supervisors, finance directors and company officers.

• (b) External Users : External users are those groups of persons or association who are not directly concerned with the conduct of business, but they are directly or indirectly influenced by the accounting information conveyed through the financial statements. External users include prospective investors, lenders, creditors, banks, government and regulating agencies, employees, consumers etc.