Tesco PLC



Tesco PLC

Financial Information

The financial information is necessary for the management and development of enterprises and therefore is processed and concentrated for use by management and people working in the company. The need for this information has introduced the concept of financial statements. Financial information has become an integrated set of financial statements and notes to express what are the financial conditions, results of operations and changes in financial position of an enterprise (Hodge 2010, 101-133). The importance of financial information lies in the fact that it serves to formulate its findings on the financial performance of the entity. Through this and other evidence, a general user can evaluate the future of the business and make economic decisions on it.

There are broadly two kinds of users of financial information; internal and external users. Financial information is essentially used by internal as well as external stakeholders for various purposes.

Internal Users of Financial Information

Internal users are the owners or members thereof, officers or managers of the company, employees and whose character is optional, in addition to its functionality using a predetermined basis. The internal users are subject to the management personnel of the company (Conroy 2010, 183-194). These users are responsible for taking various important decisions in the company. Here we shall discuss the needs, requirements and usage of financial information to specific internal users of the enterprise.

Chief Executive Officers' Needs

Chief Executive is the top executive of the organization, company or organization. He is planning, organization, coordination and control for everything related to the internal administration of the company. He is also involved in determining policy and oversees and manages everything related to the work. The availability of information in a timely and appropriate form is importance for decision making process (Fischer 2010, 374-399). He facilitates public relations with shareholders, institutions and the press and facilitates the communication between the steering committee and the parts in contact with this committee. Given the responsibilities, there are certain figures and information the CEO wants to be available at all times (Fischer 2010, 374-399).

Net profit is the excess of income over the expenses following the posting of depreciation, accruals and reserves. Net Profit is the most important figure that any CEO is concerned about since it entails the sustainability and profitability of the business at the end of the day.

Payroll materializes the relationship between employer and employee, the pay slip is a document required to periodically meet certain rules. This document may be the basis for cash disbursement.

The cash position of a business is more important indicator than Net Profit and is one of the prime concerns for a CEO. It tells the true position as to where the company stands in terms of finances and sustainability.

Budget and Sales carries an important space on CEO's information desk. Budget is a formulated plan of expected future revenues and expenditures. It entails the quantity of the resource allocated to specific activities, the purpose or project, for example, the budget office of the president, the municipal budget, marketing ...