stakeholders

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  • Why are different stakeholders interested in financial statements?
    • shareholders / owners
      • return on their investment
      • to see if they’re profitable and are going to stay profitable
      • may sell shares: share price goes down: devalues business
    • managers / employees
      • job security, promotion, bonuses, pay rise
      • expansion / reduction
      • concerned about their jobs
    • lenders
      • if a business owes money to other lenders
      • profit and loss: might not be able to pay them back
    • customers
      • contract / service agreements will be honoured
      • going to be around in the future
    • government
      • employment, generates more tax
      • keep uk economy strong: exporting goods
      • expansion = more employment
    • suppliers
      • level of creditors
      • they’ll be paid for goods that they’ve supplied
      • business will make more orders in the future

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