ABSTRACT
For many years, limited liability companies have been owned and managed by two dierent groups of people. The owners are the shareholders who provide nance to set up companies and to help them to grow. The managers are the directors of the companies and they are responsible for running the companies on a day-to-day basis. Because of this separation, it is necessary that nancial information be produced by the managers and reported to the owners. This reporting is needed to demonstrate how well the management has looked after the investment of the owners, how well it has fullled the “stewardship” role. The report produced is what we now refer to as the “annual report and accounts” or “nancial statements”.
