Understanding the importance of this information and how your department contributes to the process is valuable to you and your company. Some of the questions that might be asked by the managers of the company including ways to cut costs. Internal managers will use accounting information to answer several questions including to determine pricing for maximizing income, and cash flow for budgeting and paying dividends.

All,

Why do the external users want to know if the company is profitable or not? What decisions are creditors making about the company? What authorities use financial reporting? and Why?