Question

Answer the following questions.

State responsibilities of business organization towards owners.

Answer 1

Responsibilities of a business towards its owners:

i. As owners and shareholders invest their money in a business, it is the responsibility of the business enterprise to safeguard their investments and provide them fair and timely returns.

ii. Business organisations should provide complete and accurate information about their progress and financial position to their owners. This can be done through reports, statement of profits, etc.

iii. It is the responsibility of business organisations to minimise the wastage of resources so that maximum profits can be earned.

iv. Business units should run the business efficiently. They should make maximum utilisation of the available resources, with no or minimum wastage.