Martinez, Irish Benette M.

Bachelor of Science in Accountancy (BSA)

FDNACCT – C38

USERS OF FINANCIAL INFORMATION

INTERNAL USERS
Internal users are those who make decisions on behalf of the organization.
USERS DESCRIPTION EXAMPLE
Managers/Management They plan, Figure 1. Tim Cook as CEO of Apple
a. Top-level organize, and Company
Management run a
(e.g. Chief business. Top-
Executive Officer level
(CEO), Chief management
Financial Officer use the
(CFO), and Chief information to
Operating Officer oversee the
(COO)) performance
b. Middle-level of the whole Note: Tim cook has served as chief
Management organization executive officer of Apple since August
(e.g. department and set its 2011. Reprinted from Biography News
heads, branch strategic Letter (2020). Tim Cook Biography.
managers, junior direction. https://www.biography.com/business-
executives) Middle-level figure/tim-cook
c. Lower-level management
Management ensure that Figure 2. Zul as Branch Manager of
(e.g. supervisors their units Jollibee Malaysia
and team leaders) performances
are aligned
with the
organization’s
objectives.
Lower-level
management
oversee the
day-to-day
operations Note: Store Manager at Centre Pointe
and direct Sabah, Malaysia. Reprinted from Jollibee
employees in Malaysia Facebook Page (2018). Jollibee
the Malaysia. https://www.facebook.com
performance /JollibeeMalaysia/photos
of tasks
(Rabo, Tugas Figure 3. Benedict Hernandez, Intelligent
and Operations Supervisor of Accenture
 Salendrez,
2016, p. 21).

Note: Benedict Hernandez has overall

responsibility for the delivery of Accenture
Intelligent Operations in the Philippines to
top clients worldwide. Reprinted from
Contact Center Association of the
Philippines (2020). BENEDICT HERNANDEZ.
https://ccap.ph/staff/benedict-
hernandez/
Employees/Labor Unions They assess Figure 4. McDonald’s Employees
the
company’s
profitability
and stability,
and their
consequence
on future
salary and
job security Note: McDonald’s Employees. Reprinted
(Rabo, Tugas from McDonald’s Newsroom (2020). Our
and People: McDonald’s Employees.
Salendrez, https://news.mcdonalds.com/stories/our-
2016, p. 21). people

Figure 5. Federation of Free Workers (FFW)

Note: FFW rally to end contractualization.

Reprinted from UNTV Web (2017). Labor
groups protest vs new DOLE policy on
contractualization.
 https://www.untvweb.com/news/abor-
groups-protest-vs-new-dole-policy-on-
contractualization/

Figure 6. Kilusang Mayo Uno (KMU)

Note: Kilusang Mayo Uno (KMU) blasted

the threats against workers aired by former
Davao City Mayor Rodrigo Duterte.
Reprinted from Bulatlat News (2016). ‘Are
you joking or did you just declare war?’
KMU on Duterte’s anti-union spiel.
https://www.bulatlat.com/2016/02/12/are-
you-joking-or-did-you-just-declare-a-war-
kmu-on-dutertes-anti-union-spiel/

Owners They prove Figure 7. Cynthia Villar of Villar Group of

the capital to Companies
the business.
Owners need
these
accounting
information to
help them
decide
whether they
should
Note: Cynthia Villar hands house and lot
withdraw or
to raffle draw winner, OFW Anilyn Plata.
increase their
Reprinted from Press Reader (2018). Villar
investments.
SIPAG OFW’s Summit.
They are
https://www.pressreader.com/
interested to
philippines/the-philippine-
know the
star/20181124/281663961058149
returns on
their
Figure 8. Slater Young of Liteblock
investment
Philippines
(Rabo, Tugas
and
 Salendrez,
2016, p. 21).

Note: Slater Young’s promotional

campaign for his own business. Reprinted
from Liteblock Philippines (2020). Liteblock:
Lightweight Concerets at its Best.
https://liteblock.ph/about-us/

Figure 9. Vice Ganda of Vice Ganda

Cosmetics

Note: Vice Ganda’s advertising campaign

for his cosmetic brand. Reprinted from
Vice Ganda Cosmetics (2016). VICE.
https://www.vicecosmetics.com.ph

EXTERNAL USERS
The external users of financial reports are those who make their decisions based on
the company’s financial information.
 USERS DESCRIPTION EXAMPLE
Suppliers They use the Figure 9. Viajero Wholesale
financial
statements of
their customers to
determine
whether the
debts owed to
them will be paid
when due or
whether the Note: Front view of Viajero Wholesale.
customer has Reprinted from Viajero Wholesale
enough funds or (2015). Viajero Wholesale: Wholesale
resources to pay Clothes Supplier.
the goods to be https://www.viajerowholesale.com.ph
delivered or the
services to be Figure 10. JB Merchandising
rendered (Rabo,
Tugas and
Salendrez, 2016,
p. 23).

Note: Inside view of JB Merchandising

Company. Reprinted from JBM Office
Supplies (2015). JBM Office Supply.
https://jbmofficesupply.com/about-
us/

Figure 11. Kily.ph

Note: Inside view of Kily.ph store.

Reprinted from KILY PH (2017). Kily.ph.
https://kily.ph/
 Tax Authorities They use financial Figure 12. Bureau of Internal Revenue
reports to (BIR)
determine the
credibility of the
tax returns filed
on behalf of the
company. They
are interested to
know if the
business paid the
correct amount Note: Front view of BIR. Reprinted
of taxes (Rabo, from Business World (2020). BIR’s
Tugas and notice of discrepancy reinstated.
Salendrez, 2016, https://www.bworldonline.com/birs-
p. 23). notice-of-discrepancy-reinstated/

Regulatory Bodies They want to Figure 13. Commission on Audit

ensure that the (COA)
company’s
disclosure of
accounting
information is in
accordance with
the rules and
regulations set in
order to protect
the interest of the Note: Front view of COA. Reprinted
stakeholders who from Lakansining Word Press (2017).
rely on such Commission on Audit Complex Part I.
information https://lakansining.wordpress.com/
(Rabo, Tugas and 2017/05/11/ commission-on-audit-
Salendrez, 2016, complex-part-i/
p. 23).

Figure 14. Philippine Securities and

Exchange Commission (SEC)
 Note: Front view of PSEC. Reprinted
from Bilyonaryo (2019). SEC gives
green light to first one-man
corporation.
https://bilyonaryo.com.ph/
2019/05/09/sec-gives-green-light-to-
first-one-man-corporation/

Figure 15. Philippine Institute of

Certified Public Accountants (PICPA)

Note: Regulators’ Forum. Reprinted

from PICPA Official Website (1929).
Regulators’ Forum.
https://picpa.com.ph/

TYPES OF BUSINESS ACCORDING TO OWNERSHIP

ACCORDING TO OWNERSHIP
DESCRIPTION EXAMPLE
Sole Proprietorship Sole Figure 16. Ricky Reyes Beauty Salon
proprietorship is
a business that is
owned by only
one individual
for the practice
of trade or
profession. The
owner has full
control of
operations, thus
all profits go Note: Front view of Ricky Reyes Beauty
directly to hem. Salon. Reprinted from Wikipedia (1997).
It has less Ricky Reyes (hairdresser).
regulations. The https://en.wikipedia.org/wiki
government /Ricky_Reyes_(hairdresser)
taxes the owner
Figure 17. Colourette Cosmetics
 and not the
business.
However, the
owner is legally
obliged to pay
all business
debts, extending
up to his or her
personal assets.
Note: Sole owner of Colourette Cosmetics,
The business only
Nina Dizon. Reprinted from Colourette
ceases to
Cosmetics (2020). Colourette Cosmetics.
operate if the
https://colourettecosmetics.com
owner dies,
becomes
Figure 18. Kani Patty
physically or
mentally
incapacitated,
or is imprisoned
(Rabo, Tugas
and Salendrez,
2016, p. 27).

Note: Products of Kani Patty, owned by

Patrice Balon. Reprinted from Kani Patty
Official Facebook Page (2020). Kani Patty
PH.
https://www.facebook.com/kanipatty/

Partnership A partnership is Figure 19. Isla Lipana & Co.

a business that is
owned by two
or more
individuals
pooling their
resources
together as
common fund.
The partners are
normally Note: Diverse team of accounting
involved in the professionals from Isla Lipana & Co.
management Accounting Firm. Reprinted from PwC
and operation Philippines (1922). Isla Lipana & Co..
of the business.
The profit of the https://www.pwc.com/ph/en/about-
business is us.html/
divided among
the partners as Figure 20. Pimentel Rodriguez Simbulan &
per partners’ Partners
agreement. It
entails, however,
unlimited liability
of one or all
owners. The
business ceases
to operate if one
of the partners
dies, becomes
physically or
mentally
incapacitated,
or is imprisoned
(Rabo, Tugas
and Salendrez, Note: Partnership founded in 1988 to
2016, p. 28). provide comprehensive architectural
design and documentation services.
Reprinted from PRSP (1988). PRSP
Architects.
http://www.prsparchitects.com
/About.html/

Figure 21. Arceo & Tandoc Law Firm

Note: Arceo & Tandoc Law Firm (A&T Law)

is a full-service law office in Quezon City,
the largest city in Metro Manila,
Philippines. Reprinted from A&T Website
(1993). Arceo & Tandoc Law.
https://www.arceotandoc.com/attorneys-
lawyers-in-philippines/
Corporation A corporation is Figure 22. San Miguel Corporation
a business
required to have
five to fifteen
incorporators. It
has a legal
personality that
is separate and
distinct from the
owners. The
owners have Note: Front view of San Miguel
limited liability Corporation. Reprinted from San Miguel
and limited Corporation Official Website (2018). San
involvement Miguel Corporation.
from the https://www.sanmiguel.com.ph
operations,
which are Figure 23. Apple Inc.
considered as
an advantage.
It has unlimited
commercial life
and significantly
offers more
resources of
funds. However,
profit is taxed at
the corporate Note: Front view of Apple Inc. Reprinted
tax rate. from Apple Official Website (1976). Apple
Stockholders are Official Website.
taxed again https://www.apple.com
when profits are
distributed to Figure 24. Nestle Philippines, Inc.
them. There are
also more
regulations to be
followed in a
corporation
(Rabo, Tugas
and Salendrez,
2016, p. 29).

Note: Nestle Philippines symposium.

Reprinted from Nestle Philippines Inc.
 Official Website (2018). Nestle Philippines
symposium. https://www.nestle.com.ph

TYPES OF BUSINESS ACCORDING TO ACTIVITIES

ACCORDING TO BUSINESS ACTIVITY
DESCRIPTION EXAMPLE
Service These are Figure 25. Happy Move
companies that
focus on
providing
intangible
products, such
as offering
professional
skills, proposals,
and expertise.
In addition, skills
in question can Note: Happy Move delivering a product
be improved from a small-time local business. Reprinted
and can from Happy Movie Official Facebook
produce better Page PH (2019). Happy Move PH.
service. There is https://www.facebook.com/
no need for happymoveph/posts
inventory in this Figure 26. Grab Philippines
business type
(Rabo, Tugas
and Salendrez,
2016, p. 31).

Note: Grab drivers uniting. Reprinted from

Grab Philippines Official Facebook Page
(2019). Grab Philippines.
https://www.facebook.com/GrabPH/

Figure 27. Cebu Pacific

 Note: Cebu Pacific flight attendants
posing for the airline’s promotional
campaign. Reprinted from JG Summit
Holdings, Inc. (2016). Cebu Pacific.
https://www.jgsummit.com.ph/business-
units/cebu-pacific-air

Merchandising or This type of Figure 28. Rustan’s Supermarket

Trading business is
commonly
known as the
“buy and sell”
business.
Essentially,
products are
bought from
manufacturers
or other Note: Inside view of Rustan’s Supermarket.
merchandisers Reprinted from Trip Advisory (2020).
and are sold as Rustan’s Supermarket.
is at an amount https://www.tripadvisor.com/
higher than the LocationPhotoDirectLink-g1758900-
purchase price. d9869907-i393068320-Uptown_Place_Mall-
It is known to be Taguig_City_Metro_Manila_Luzon.html
flexible to
changes (Rabo, Figure 29. Uniqlo Clothing Store
Tugas and
Salendrez, 2016,
p. 31).
 Note: Front view of Uniqlo Clothing Store.
Reprinted from Rappler (2020). Uniqlo
Philippines launches online store.
https://www.rappler.com/life-and-
style/style/uniqlo-philippines-online-
shopping

Figure 30. 7-Eleven Philippines

Note: Front view of 7-Eleven. Reprinted

from Philippine Retailers (2016). Upgrade
for 7-Eleven Philippines Store.
https://www.philretailers.com/upgrade-
for-7-eleven-philippines-stores/

Manufacturing This is the type Figure 31. Armina Garments

of business Manufacturing Corporation
wherein
materials are
bought to
create a new
product.
However, the
cost of
manufactured
products highly
depends on the
price and Note: Day-to-day operations of Armina
availability of Garments Manufacturing Corporation.
the raw Reprinted from Global Sources (2019).
materials Products of Armina Garments.
(Rabo, Tugas https://www.globalsources.com/si/AS/
and Salendrez, Armina-
2016, p. 32). Garments/6008847511774/Homepage.htm

Figure 32. Big Boss Cement Inc.

Note: Day-to-day operations of Big Boss
Cement Inc., manufacturer of
environment-friendly cement products.
Reprinted from Big Boss Cement Inc.
Official Page (2018). Tomorrow’s Cement
Today. https://bigbosscement.com

Figure 33. Supersonic Manufacturing

Note: Supersonic Manufacturing Inc.,

specializes on steel wire manufacturing
products. Reprinted from Supersonic
Manufacturing Inc. Official Website (2015).
Supersonic Gabions.
http://supersonicgabions.ph
 REFERENCES

Rabo, Tugas & Salendrez, (2016). Fundamentals of Accountancy, Business,

and Management 1. VIBAL.