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Financial
Statements
A financial
statement (or financial report) is a formal record of the financial
activities of a given business, person, or other entity. In British
English—including United Kingdom company law—a financial statement
is often referred to as an account, although the term financial
statement is also used, particularly by accountants.
For a business enterprise, all the relevant financial information,
presented in a structured manner and in a form easy to understand,
are called the financial statements. They typically include four
basic financial statements.
1.Balance
sheet: also referred to as statement of financial position or
condition, reports on a company's assets, liabilities, and Ownership
equity at a given point in time.
2. Income statement: also referred to as Profit and Loss statement
(or a "P&L"), reports on a company's income, expenses, and profits
over a period of time. Profit & Loss account provide information on
the operation of the enterprise. These include sale and the various
expenses incurred during the processing state.
3. Statement of retained earnings: explains the changes in a
company's retained earnings over the reporting period.
4. Statement of cash flows: reports on a company's cash flow
activities, particularly its operating, investing and financing
activities.
For large corporations, these statements are often complex and may
include an extensive set of notes to the financial statements and
management discussion and analysis. The notes typically describe
each item on the balance sheet, income statement and cash flow
statement in further detail. Notes to financial statements are
considered an integral part of the financial statements
Source: Wikipedia
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