Question

Knowing that the company's former CFO and CEO not only got in trouble for fiduciary responsibility violations but IRS issues as well, you plan to write a report with your senior accountants to go over the main differences between the roles of financial accounting, cost accounting, and tax accounting as some of the prior accounting department misdeeds seemed to come from not keeping these separate.

In paragraph form, explain why it is important to understand the different needs of the different stakeholder groups for each functional area.

Answer 1

It is important to understand the different needs of the different stakeholders groups for the above accounting function in order to establish the nature, content, and timing of the financial information (Drury, 2013). Each stakeholder group requires financial information with a particular content and drawn using a certain format. The study of the three functional area of accounting is significant in assisting the stakeholders to achieve their objectives and goals in the overall organizational performance. This is possible due to the ability to understand the functions and content of each accounting functions.