Purpose of financial statements.

The purpose of financial statements is to provide information about the financial position, performance and changes in financial position of the entity that is useful to wide range of users in making economic decision.
purpose of financial statements
Financial statements also show the result of the stewardship of management or the accountability of management for resources entrusted to it. Those users who wish to assess the stewardship or accountability of management do so in order that they may make economic decision; these decisions may include for example, whether to hold or sell their investment in the entity or whether to reappoint or replace its management.

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