WAEC Accounting 2023 Theory — Question 9

Model answer

1. Management/Managers - interested in how the business is progressing, its financial position, and whether set targets are being achieved. 2. Owners/Shareholders - interested in whether the business is profitable, the security of their investment, whether the business can pay dividends, and whether to hold or sell their shares. 3. Bankers/Financial institutions - need the information to assess the creditworthiness of the business and evaluate its ability to repay borrowed funds when due. 4. Tax authorities - need the information to assess the tax payable and ensure all relevant information has been captured in the financial statements. 5. Potential investors - need accounting information to assess the viability of the business before investing. (Other acceptable: Competitors - to assess the strengths and weaknesses of similar businesses; Employees - to evaluate job security, ability of the business to pay remuneration, and as a basis for collective bargaining; Regulatory bodies - to ensure compliance with requirements/standards; Trade unions - to have a basis for negotiating improved conditions; Customers/Debtors - to determine the business's ability to meet orders and offer credit facilities; Suppliers/Creditors - to determine the business's ability and time taken to pay its debts; Financial analysts/researchers - for advisory and academic purposes; General public - to appraise the efficiency and social responsibility of the business.)