What is the main interest of top management in financial statements analysis?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- Measuring the effectiveness of managements decision.
Management of the firm would be interested in every aspect of the financial analysis. It is their overall responsibility to see that the resources of the firm are used most efficiently and that the firm’s financial condition is sound. Financial analysis helps the management in measuring the success of the company’s operations, appraising the individual’s performance and evaluating the system of internal control.