Financial statements are the written records of the financial status of the business that allow interested parties to evaluate the profitability and solvency of the business.
What is Financial statement?
- Financial statements are written records that outline an organization's operations and financial performance.
- The balance sheet gives a quick picture of the company's assets, liabilities, and shareholders' equity.
- The revenues and expenses incurred by a corporation during a specific time period are the main subjects of the income statement. The statement generates a profit figure known as net income for a corporation after expenses are deducted from revenues.
- The cash flow statement (CFS) gauges how effectively a business earns cash to cover debt payments, operating costs, and investments.
- The statement of changes in equity keeps track of whether profits are dispersed to third parties or are kept in-house for future expansion.
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