Question

QUESTION 2 Identify 3 EXTERNAL users of financial information/statements and list 3 questions per each of these they might ask the company? TTT Arial 3 (12pt) • T Three external users of financial information/statements are

Answer 1

Three external users of financial information/statements are

1. Investors

Both existing and potential investors provide, or may provide risk capital in the form of funding. This group will want to know what return to expect from their investment, and whether or not to invest further or sell their current holdings.

2.Lenders

These are often banks and other providers of credit who want information that want information to help them understand if their loans will be repaid when due, and whether or not to issue new loans to the entity.

3.Other Creditors

This will include trade suppliers who may want to know whether or not to sell goods/services on credit to the entity