A formal record of a company's financial activities, including the balance sheet, income statement, and cash flow statement.
A financial statement is a comprehensive report that provides crucial financial information about a business. It summarizes the company's financial activities, performance, and position, allowing small business owners to assess their financial health and make informed decisions. Financial statements typically include the balance sheet, income statement, and cash flow statement. These statements present data on assets, liabilities, revenue, expenses, profits, and cash flows. Analyzing financial statements helps businesses track their profitability, liquidity, and overall financial stability, aiding in strategic planning, securing loans, attracting investors, and meeting regulatory requirements.