Question

users of financial accounting statements have both coinciding and conflicting needs for information of various types

Answer 1

This statement is true or correct.

Users of financial statements (income statement, balance sheet, cash flows statement, and retained earnings) are various stakeholders; like shareholders, lenders, banks, suppliers, employees, management, and tax authorities. They become users, since their respective interests are involved – interest of shareholders are getting the increasing value of their shares, interest of management is a smooth running of the business, interest of tax-authority is to get regular tax, etc.

These statements need to be evaluative and analytical; in order of getting so, these should be coinciding, means matching with what expected; and conflicting, means not matching what expected. Such as profit for the year is not matched what expected but working capital ratio at the end of the period is anticipated. They evaluate these statements differently; therefore, their purposes of stake-holding are also different.