Accounting1

Accounting1 - selling on credit or lending money. Taxing...

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Accounting: the information system that identifies, records, and communicates the economic events of an organization to interested users. Users can be divided into internal and external users. Internal Users: Managers who plan, organize, and run a business. These include: marketing managers, production, supervisors, finance directors, and company officers. Accounting provides internal reports, such as financial comparisons of operating alternatives, projections of income from new sales campaigns, and forecasts of cash needs for the next year. Companies also present summarized financial information in the form of financial statements. External Users: Types of external users: Investors: use accounting info. To make decisions to buy, hold, or sell stock. Creditors: (suppliers and bankers): evaluate the risks of
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Unformatted text preview: selling on credit or lending money. Taxing authorities: want to know whether the company complies with the tax laws. Customers: whether a company will continue to honor product warranties and support its product lines. Labor Unions: want to know whether the owners have the ability to pay increased wages and benefits. Regulatory agencies: want to know if company is operating within prescribed rules. Ethical Judgement: a sound, well-functioning economy depends on accurate and dependable financial reporting. Economy suffers if investors lose confidence in corporate accounting because of unethical financial reporting. SOX has required companies to certify accuracy of financial information. Penalties are also much more severe now....
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This note was uploaded on 03/30/2012 for the course ECO 1111 taught by Professor Xxxx during the Spring '08 term at Kentucky.

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