External users have limited authority, ability and resources to obtain necessary information and have to rely on financial statements (Balance Sheet and Profit and Loss account) as their principal source of information. They need information for making important economic decisions.

Present and potential investors (shareholders) require information for predicting and evaluating the amount, timing and uncertainty of potential cash-flows. They are interested in profitability, share performance, and judging management's ability to utilise resources effectively.

Creditors including banks, financial institutions, debenture-holders and other lenders need information about the firm's long-term future and its ability to carry on providing a service or producing a product to assess creditworthiness.

Government and tax authorities need information on allocation of resources and compliance to regulations, including VAT and other tax liabilities. Regulatory agencies like Department of Company Affairs, Registrar of Companies and SEBI require information for regulatory purposes.

Other external users include social responsibility groups (environmental groups) who need information on impact on environment and its protection, competitors who require information on relative strengths and weaknesses for benchmarking and strategic purposes, labour unions interested in pay awards and bonus deals, and customers who need information about the firm's ability to continue providing services.