ARBUS102 Chapter Notes - Chapter 5: International Financial Reporting Standards, International Accounting Standards Board, Canadian Securities Administrators
31 Jan 2016
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Document Summary
Use accounting information to run the business. Accounting information used to manage a business, is used to fulfill a management function. Directors used to describe members of the board of directors, selected. Oversea the managers, ensure that management and financial. Use financial statements to evaluate decisions about amount to invest by shareholders as representatives decisions aim to benefit shareholders in assets and have managed to generate sales and net income from those assets. Accounting info used to oversea business, used in a governance role. Ex. suppliers use accounting info to decided whether to enter into contracts, based on whether those companies have assets to pay their liabilities. Banker evaluate (and limit) a company"s activities by measuring the company"s ability to satisfy financial targets, such as maintaining specific levels of assets. Loan covenants: terms of a loan agreement that, if broken, entitle the lender to renegotiate loan terms or to force repayment.
