GET FREE TRIAL NOW
Login
JSC Global Accounting Services Blog
  • Blog Home
  • Categories
    • Entrepreneurship
    • Finance
    • Marketing
    • Small Business
  • JSC Global Website
No Result
View All Result
JSC Global Accounting Services Blog
  • Blog Home
  • Categories
    • Entrepreneurship
    • Finance
    • Marketing
    • Small Business
  • JSC Global Website
GET FREE TRIAL NOW
Login
No Result
View All Result
JSC Global Accounting Services Blog
No Result
View All Result
Home Finance

How to Read the Financial Report of a Business.

Admin by Admin
February 13, 2020
in Accounting, Finance, Small Business
2 min read
0
How to read financial report of a business

How to read financial report of a business

0
SHARES
Share on FacebookShare on Twitter

A company’s financial statement is used to show a company’s performance over a certain period, generally every fiscal quarter. The financial statement consists of three different statements:

1- Balance sheets
2- Cash Flow Statements and
3- Income Statements.

By being able to read a financial statement, you can determine where a company has made or lost money, where the money went and how the company stands financially. The financial statement gives shareholders an accounting of how their investment is performing.

Components of a Financial Statement:

1- Balance Sheets:

Represent the assets, liabilities and the net worth or shareholder equity of the company. Assets make up all the property the company owns, including bank accounts, real estate, machinery, etc. An asset can also be intangible such as a trademark or patent.

Liabilities consist of the money the company owes others.This can include leases on real estate, loans, accounts payable to suppliers of material, tax liabilities or obligations to deliver a product. Liabilities also include employee payrolls and money borrowed from banks.

Shareholder equity represents the company’s net worth if it were liquidated and what each shareholder would receive after paying the creditors of the company.

2- Cash Flow Statements:

Reports on the inflow and outflow of the company’s money. The cash flow statement is divided into financing activities, operating activities, and investment activities. The combination, of these three parts, show the change in capital position the company had over some time.

3- Income Statements:

Show how much revenue the company took in over a specified period and how much money was spent to get that revenue. The income statement shows the company’s net earnings or losses on the bottom line and begins with all the cash the company took in at the top and goes through all the expenses it took to make that money with the net figure on the bottom.

Knowing how to read a financial statement gives an investor or analyst a clear picture of the financial position of a business. Nevertheless, past performance does not generally guarantee future results; keep this in mind before investing in any company.

Related

JSC Global Accounting Services Free TrialJSC Global Accounting Services Free TrialJSC Global Accounting Services Free Trial
ADVERTISEMENT

Newsletter

Subscribe to receive weekly business accounting and bookkeeping tips and guide.

Popular Articles

  • KEY MISTAKES NEW BUSINESS OWNERS MUST AVOID!

    0 shares
    Share 0 Tweet 0
  • How to Deter Fraud as Small Business Owner

    0 shares
    Share 0 Tweet 0
  • Corporate Governance!

    0 shares
    Share 0 Tweet 0
  • How to Get an Accountant for your Small Business?

    0 shares
    Share 0 Tweet 0
  • #7 Causes of Cash Flow Problems & Solutions

    0 shares
    Share 0 Tweet 0
ADVERTISEMENT

About Us

JSC Global Accounting Services is a professional accounting services firm providing accounting, bookkeeping and controller services. JSC Global Accounting Services performs functions such general ledger accounting, payroll, financial analysis, bank reconciliations, and financial statement preparation.

Latest New

  • The 10 Point Checklist for Getting a Small Business Loan
  • #5 Digital Culture to Work Better, Faster, and Efficient.
  • #7 Causes of Cash Flow Problems & Solutions

Useful Links

  • Accounting
  • Payroll
  • About JSC
  • Contact Us
  • Website Policy
  • Privacy Statement

Newsletter

Subscribe to receive weekly business accounting and bookkeeping tips and guide.

© 2019 JSC Global Accounting Services. Developed by Giga Lagos Digital.

No Result
View All Result
  • Blog Home
  • Categories
    • Entrepreneurship
    • Finance
    • Marketing
    • Small Business
  • JSC Global Website

© 2019 JSC Global Accounting Services. Developed by Giga Lagos Digital.