Users of financial statements
i) Tax authorities: Audited accounts give a true picture of the entity‘s profits and can be relied upon tax authorities for the assessment of tax on the company.
ii) Lenders:- audited accounts are credible and therefore can be relied upon to assess the credit worthiness of the entity.
iii) Employees – Are interested in whether the entity is a going concern, which can be established from the audited accounts to ensure job security.
iv) Customers – those who rely on entity‘s products are interested on whether the entity will be producing in future (going concern) or whether they ought to look for alternative suppliers
v) Potential/actual investors need to know whether investing in the company is worthwhile i.e are they bound to benefit financially in terms of dividends and capital gains.