Types of financial reports
Financial reports refer to statements that provide details of an organization's financial information, including assets, liabilities, equity, revenues, expenses, shareholders' contribution and cash flows over a period of time.[١] The following is an explanation of the types of financial reports:
Income statement
An income statement includes information about revenues, expenses, and profits or losses for a specific period of time. An income statement is sometimes called a statement of Financial performance; because this statement allows users to evaluate and measure the financial performance of the organization from one period to another.[١]
This statement can be in two different forms permitted by IFRS, depending on: Institutional decision, taken The first format is a single statement format where both income and other comprehensive income statements are presented in a single statement.[١]
The second form takes the form of multiple statements, where income and other comprehensive income data are displayed in two different statements. It is worth noting that if users want to know The amount of sales of the company, the amount of expenses incurred, and the amount of profit Or loss during the period, the income statement is the statement that allows them to know these details.[١]
Balance sheet
The balance sheet shows the financial position of a business as of the reporting date; that is, it covers a specific period of time. The balance sheet contains information about assets, liabilities, and equity. It is worth noting that the items included in the assets and liabilities classification are presented in order of liquidity, with the most liquid items listed first.[٢]
The balance sheet is a fundamental document, and therefore is included in most financial reporting versions.[٢] A balance sheet can show the current value of a business for a specific period, and looking at its balance sheet can help an organization know whether it can meet its financial obligations.[٣]
Statement of Change in Equity
The statement of changes in equity documents all changes in equity during the reporting period. These changes include the issuance or purchase of shares, dividends, and profits and losses. This document is not usually included when issuing financial reports internally, as the information contained in it is not useful to the management team.[٢]
This statement explains the changes in Copyright in the event of In the case of a sole trader, it shows the changes in the ownership rights of both partners, and in the case of a company, it shows the change in ownership rights between all shareholders.[٣]
cash flow statement
The statement of cash flows reveals the cash inflows and outflows of an organization during the reporting period. These cash flows are divided into three categories: operating activities, investing activities, and financing activities. This document can be difficult to compile, so it is most commonly issued to external parties only.[٣]
A cash flow statement shows how money enters and leaves a business, and is useful for knowing Capital Available to the organization at a given time, and since it does not take into account raw materials or purchases that have been made but not yet paid for, it is necessary to show how quickly the organization can obtain cash if it needs it.[٣]
the reviewer
- ^ A for T Th Dear Mr. Kong, “5 Types of Financial Statements (The Completed Set)”, wikiaccounting, Retrieved 26/1/2022. Edited.
- ^ A for T “Types of financial statements”, accountingtools, 21/1/2022, Retrieved 26/1/2022. Edited.
- ^ A for T Th “5 Types of Financial Statements”, gocardless, Retrieved 26/1/2022. Edited.
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