Question

Explain five reasons why certain groups or organizations request for Public Sector Financial Information

Answer 1

Certain groups or organizations request for Public Sector Financial Information because they want to gain an understanding of the performance of the entity with respect to the following:-

1. Expenditure incurred and revenues generated by the organization.- Financial statements contain the details of income and expenses which is essential to analyze the business information.

2. Services and goods delivered by the organization:- Financial statements contains the gist of services performed or goods sold which enable them that in observing the public sector dealings.

3. Details about the liabilities incurred and assets held by the organization:- Liabilities and assets are the key information needed to determine the stability of public sector enterprise.

4. Budgets and objectives met or not- Financial statements enable in determining the failures if any which the public sector enterprise is having because they have the tendency to be inefficient.

5. Future planning and strategies to be followed by the organization- To get a brief hint about the future it is very important to look into the future course of planning and strategies of the public sector organization and this is available in financial statements.

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