How is accounting information useful for external users?

1.	How is accounting information useful for external users?
Answer» (i) Creditors:\xa0for determining the credit worthiness of the organization.\xa0(ii) Tax Authourities:\xa0for determining the credibility of the tax returns filed on behalf of the company.(iii) Investors:\xa0for analyzing the feasibility of investing in the company. Investors want to make sure they can earn a reasonable return on their investment before they commit any financial resources to the company.(iv) Customers:\xa0for knowing\xa0the financial position of its suppliers which is necessary for them to maintain a stable source of supply in the long term.(v) Regulatory Authorities:\xa0for ensuring that the company\'s disclosure of accounting information is in accordance with the rules and regulations set in order to protect the interests of the stakeholders who rely on such information in forming their decisions.

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