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NATURE AND determination OF FINANCIAL STATEMENTS A pecuniary averment (or financial report) is a formal record of the financial activities of a byplay, person, or other entity. For a business green light, all the germane(predicate) financial reading, presented in a structured manner and in a form easy to understand, argon called the financial statements. They typically allow in four basic financial statements, accompanied by a focusing discussion and analysis: 1.Balance sheet: withal referred to as statement of financial plant or condition, reports on a social club?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& deoxyadenosine monophosphate;L), reports on a company?s income, expenses, and win all over a period of time. Profit & Loss account bid information on the carrying out of the enterprise. These include sale and the various expenses incurred during the p rocessing state. 3.Statement of retained fee: explains the changes in a company?s retained cyberspace over the reporting period. 4.Statement of cash flows: reports on a company?s cash flow activities, particularly its operating, investing and funding activities.

PURPOSE OF FINANCIAL STATEMENTS The objective of financial statements is to provide information about the financial position, performance and changes in financial position of an enterprise that is useful to a wide range of users in devising economic decisions.Financial statements may be used by users for opposite purposes: * Owners and managers require financial statements to make important business decisions that hazard its continued operations. Financial a! nalysis is then performed on these statements to provide management with a more detailed rationality of the figures. These statements are also used as part of management?s annual report to the stockholders. * Employees also need these reports in reservation collective bargaining agreements (CBA) with the...If you want to get a rise essay, order it on our website: OrderEssay.net

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