Question

For whom, analysis of financial statements is not significant?

• A. Investors
• B. Government
• C. Ambassador of India
• D. Company's Employees

Hint:

Financial statements are primarily analyzed by stakeholders whose decisions depend on the financial health of the company, such as investors, employees, and government entities.

Answer 1

The Correct Option is C

Step 1: Understanding the purpose of financial statement analysis.
Financial statements provide valuable information to a wide range of stakeholders such as investors, employees, government, and others. The analysis is typically done to assess the financial health and performance of a company.
Step 2: Identifying the irrelevant party.
- (A) Investors: Investors rely on financial statement analysis to make informed decisions about purchasing, holding, or selling shares.
- (B) Government: Governments use financial statements to assess taxes and compliance with regulations.
- (D) Company's Employees: Employees may analyze financial statements to understand the company’s performance, which can affect their compensation and job security.
- (C) Ambassador of India: The Ambassador of India is not typically concerned with a company’s financial statements as their role is diplomatic, not financial.
Step 3: Conclusion.
The correct answer is (C) Ambassador of India, as financial statement analysis is generally not relevant to them.