What is meant by financial statements?

[niyati]

I keep coming across the term financial statements when reading about business and accounting. Can someone explain what financial statements are?

 

[jatin]

Financial statements are formal records of a company’s financial activities. They provide an overview of a business's financial performance and position. The main types are:

1. Income Statement – Shows profitability over a period.
2. Balance Sheet – Displays assets, liabilities, and equity at a specific point in time.
3. Cash Flow Statement – Tracks cash inflows and outflows.
4. Statement of Retained Earnings – Shows changes in retained earnings over a period.

These statements help stakeholders assess the company’s financial health and make informed decisions.

 

[jainnorton]

Financial statements are formal records of a business's financial activities, including the balance sheet, income statement, and cash flow statement. They provide insights into performance, profitability, and financial health for investors and regulators.

 

[maria]

Financial statements are formal reports summarizing a company's financial performance and position over a specific period. They provide vital information on what a company owns (assets), owes (liabilities), and its profitability and cash flow, helping stakeholders make informed economic decisions.

 

[masur]

Financial statements are official documents that describe the financial activity and the status of a company. These are the balance sheet, income statement and cash flow statement. These reports assistinvestors, management and stakeholders in determining profitability, performance, cash flow, and financial health in general, in order to aid decision-making and adherence to accounting principles.