What are financial statements? What information do they provide.
Answers
Financial statements refers to the documents that display firm's financial position. It provides information about the personal accounts of a company.
Explanation:
Financial statements refers to the documents or reports that are made by a firm's management in order to display its financial position and performance.
Financial statements include different types of statements such as cash flow statement, owner's equity statement, balance sheet, and income statement.
Following are the information that financial statements provide:
i. These statements provide details and information about equity, expenses, investment, liabilities, assets, gains, income, losses, etc.
ii. It also provides information about the personal accounts of a company such as dealing with retirement planning, bank loans, tax planning, and estate planning.
iii. Financial statements also provide information about allocation of company's resources and decisions regarding organization's operations.