2. Critical evaluation of the accounting function in informing decision making and meeting stakeholder and societal needs and expectations

Accounting helps in decision making by disclosing the relevant information to the interested parties. By this the managers finalize on the sort of information given to them for the decisions they must make. this is done through an internal financial statement to identify profit maximization opportunities for the company's controlled growth, financial accounting is crucial to any sort of financial decision making.

The reason why the accounting information is vital in decision making process of an organization is to inform the higher-level managers in charge of making decisions for any potential risks and losses that they should be aware of and to prepare for any surplus or deficit for an organizations financial state. The accountants play an important role when it comes to making decisions as they understand the bigger picture from past and future benefit to the company, that is why performing accounting functions is important in decision making.

Owners and Managers

Once prepared the financial statements by summarizing the transactions that took place in a certain period in an organization, the statements are then provided for the owners and the managers for the purpose of decision making as it shows if the company have a surplus of profit or not and this allows them to make decisions accordingly.

 Investors and Creditors

Investors and creditors have a huge impact on the company’s financial records. Because they know that it’s impossible to make smart investment and loan decisions without accurate reports on an organization’s financial health, they study financial statements to assess a company’s performance and to make decisions about continued investment.

According to the world’s most successful investor (and third-richest individual), Warren Buffett, the best way to prepare yourself to be an investor is to learn all the accounting you can. Buffett, chairman and CEO of Berkshire Hathaway, a company that invests in other companies, turned an original investment of $10,000 into a net worth of $35 billion in four decades, and he did it, in large part, by paying close attention to financial accounting reports (Price, 1998).

The role of accounting in decision making is to understand the base of the decision-making process, The primary objective of accounting is to record financial transactions in the journals so that the business could get an idea of where it stands financially. That is why the importance of accounting is crucial in an organization, for instance if the managers request a quarterly accounting statement, once provided they could keep track of not only the financial position of the organization but also to keep track of employee performances and research a business plan for potential risks for growth of the company. Therefore, the accounting functions are primarily the foundation of a business.

To be able run a business without any objection, the information should be recorded and produced as reports for analyzing the assets, liabilities, expenses, and profit making. Therefore, the management requires this information for decision making, as it is a pillar of a business. Without reasonable accounting information the business could go nowhere. For deciding the next step of a business, it has to solely depend on the original information and figures.  Management depends on the statistical and economic data that accounting provides for financial planning for the businesses long run (Leon Teeboom, 2019).