BUSINESS

Managing Resources

Managing Resources

Introduction

Stake holder is group of individual or an individual or an organization, concerned about condition and economic performance of a business, for this purpose stakeholder uses the financial information in order to make some important decision. Whereas, stakeholders are also referred as user of accounting information, the reason behind this is that stakeholders are affected due to the financial information directly or indirectly, as stakeholders are also associated with the economic activities. Stake holder plays many different roles it is defined as the purpose of different cases, such as management, owners, employees, and creditors. Providing accurate information about the company's financial accounts to stakeholders is one of the important and fundamental job of corporation many corporations face challenges in this regard, as a consequence they lack in acquiring the trust of stakeholder. The problem arises when corporation financially misrepresent themselves, without portraying accurate information about the financial position of a company, on the other hand, Corporate lying is an activity used by many corporations for deceiving the stake holders it is the intentional deception of stakeholders. The reason behind corporate lying is to develop an image which favors the company financial position. Several times accurate Information is not provided due to the intentional manipulation of corporate motives, and objectives for external stakeholders. (GREENWOOD, M. R. 2000 pp.71-79)

Primary (Internal) Stakeholders

Primary stakeholders are internal stakeholders are one who are directly involved with the transaction of the business, primary stakeholders are also considered as internal stake holders. Primary stakeholders include employees, creditors, suppliers, customers, and stockholders. (FRIEDMAN, A. L., 2006 Pp.188-195)

Owners

Owners are one who invests capital resources in business, if business type is sole proprietorship than owner is called proprietor, whereas in business partnership owners are considered as partners, and in corporation stockholders are the owners. Mostly owners invest their capital in businesses; therefore they are interested in financial reports, as it helps in knowing about the performance of business. Healthy financial performance is directly related with the value of capital investment profit or gain.

Employees

An employee is group of individuals that work in an organization, employee provides skills, professional services and talents, and employee includes manager and staff who perform daily operation. Whereas financial performance is concerned both staff and managers are concern, the reason behind this is that business financial performance directly influences their salary; such as if business is in profit than it increases the bonus or incremental chances for employees.

Suppliers

Suppliers are also primary stakeholders of business, suppliers are the one who delivers the goods or services to business, the reason suppliers interested in financial performance of business is that it helps them in determining the extent or amount of discounts they can grant to business, on the other hand it also helps in determining that how much inventory they can deliver to business.

Creditors

Creditors are one of the important stakeholders of business as they are the one who assist businesses and provide them with the financial resources, with the help of creditor's services business extend loans or credits ...