Business Administration 2257 Chapter Notes - Chapter 1: Canada Revenue Agency, Legal Personality, Limited Liability

• School: Western University
• Department: Business Administration
• Course: Business Administration 2257
• Professor: Jimmy Wang

Document Summary

Chapter 1: the purpose and use of financial statements. Accounting is the information system that identifies and records the economic events of an organization and then communicates them to a wide variety of interested users: the language of business . There are two types of users of accounting: internal and external. Internal users of accounting information plan, organize, and run companies. Examples managers, human resource, supervisors, and company officers. Users need detailed accounting information on a timely basis. A person outside of an organization who does not directly run the operation but uses the companies accounting information. Investors use accounting information to make decisions to buy, hold, or sell their ownership interest. Lenders use accounting information to evaluate the risks of lending money: example bankers. Other creditors use accounting information to decide whether or not to grant credit to a customer: example suppliers. Other examples include potential employees, labour unions, and taxing authorities (like canada revenue agency)