Question

Identify the main users of accounting information for a university.

Answer 1

The Internal users (Primary Users) of accounting information are:

Management.
Employees.
Owners.
Human Resources Department
To the internal users, the accounting information provided to them, is presented in the form of management accounts, budgets, forecasts and financial statements.

To Internal users (primary users), of the accounting information, we can define them as people who work directly in/with the company, as the ones who are involved in the daily operations (the owners) and make sure that we guarantee the sustainability of the company.

External users (Secondary Users) of accounting information are:

Creditors.
Tax Authorities’.
Potential and existing Investors.
Customers (Debtors).
Suppliers (Creditors)
Regulatory Authorities.
Banks
Government
Other Users( General Public)

To the external users, the accounting information they need is presented only in the form of financial statements (general-Purpose information) and it is summarized in three types of financial statements, relatively: Balance sheet, Income statement and the statements of cash flows.

Creditors:Creditors or lenders use the accounting information to find out the ability of the borrower to repay the loan, the number of assets and liabilities of the borrower, evidence of income, economic position, etc. before he or she lend the money to the economic entity.

Investors:Investors are the capital providers of a business. Before investing, an investor sees the financial report for figuring out the possibilities of the business in the future. Financial information is important for an investor for making sure that the investment is secure.

Employees. The ones who use the accounting information for the following purpose: To get a job security, remunerations, or an incentive to get the increase in the salary ; For controlling purposes, I mean controlling the progress of the company, in other to develop security and profitability in the company. To guarantee the good financial standing of the company.

Owners. The owners of the business are the ones who use the accounting information with the following purpose: Evaluation and the maintenance of their investment ;
Analyzing, determining the good decision making of the future of the company; To know the financial position of the...