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Shareholders are one group that belongs to the stakeholders of a company. Shareholders are one of the most important elements of the ‘set of stake holder’ which comprises of the persons and entity having
direct or indirect interest in the activities of a company as well as a direct or indirect influence in the functioning of the company. Before discussing the importance of stakeholders over the shareholders
from the accounting view point, let us take a brief look at the different types of stake holders and there interest in the company as well as their power to influence the affairs of the company.
It is said that Financial Management starts from the point, where Accountancy ends. In fact Accountancy forms the backbone of the financial management. According to the American Institute of Certified Public
Accountants (AICPA), Accountancy is defined as
-the art of recording, classifying and summarising in a significant manner and in terms of money transactions and events which are, in part at least, of a financial character, and interpreting the results