The financial statements that you must understand in your business

[BrolySSJ]

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

 

[Kelly5]

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

You have really spoken like somebody that is a true financial analyst and an accountant. I am not an accountant nor am I a financial analyst. But I do know that I can always use a hand to help me in auditing my business aside the normal profits and loss I can handle for my self

 

[CeeJase]

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

Without a proper financial statement in any business, you won't know when you're growing or falling.
Stewardship are more like devils disguised as angels and it is the financial keeps that will help you tail some of the extortion they bring along with them. So proper recording is needed in a business so as to track where it started going wrong.

 

[Trexxxy]

Indeed I think it is important to have a proper financial statement and also the ability to read and interpret. Another thing is to keep a detailed log of all the transactions, income and expenses accrued over the working days.

 

[BrolySSJ]

Indeed I think it is important to have a proper financial statement and also the ability to read and interpret. Another thing is to keep a detailed log of all the transactions, income and expenses accrued over the working days.

Yes these are very important records to have. The first is that you have to have them for legal purposes and the second reason why they are so important as well is that being able to interpret the documents ensures that there is no foul play that is happening within your company at the lower levels or among your employees as well. It is important to be able to identify this to ensure that you take the correct measures when this applies.

 

[chicnthin]

All of the financial statements are vital in the businesses. Even if you're the business owner and you're planning to employ a professional to do the work, you must at least have the basic understanding and know how to read these financial statements.

 

[Samuel77]

According to my own point of view, the financial statement you must understand in your business is that business is for profit not not loss. When you are doing a business and you are not profiting from the business you have to stop. That is not business

 

[Ridorz]

You have said the major one. It is very important to understand the financial statement, because any business without proper financially monitoring will not be able to succeed. Either you take care of you Business financial records by yourself or you hire someone to do it, you have to be always cross check.

 

[Godleads1]

All these record books are right. I just want to add that there should be the inclusion of the petty cash book. This for sure depends on the business you are running. But it helps keep records on money spent daily.

 

[EMMANUEL]

The financial statement you can understand will depend on whether you have gone through-line of profession or you have some that have given you an orientation about it, and even aside from that the basic are the once you can understand, but you might not be able to interpret an account statement even when you have the access to the whole financial comprehensive position of a company report, like adjustment of your daily journal.

 

[Shayo]

A thorough understanding of the notes of financial statements is essential to properly evaluate a business financial condition and performance.
I think you have mentioned the important financial statement a business owner has to understand but you can also add the income statement and the statement of cash flow.

 

[WhiteHouse]

Without someone loyal and honest doing a proper financial statement in any business, you won't know when you're growing or falling. And most times the business is failing, you need to know your financial standings to forge ahead.

 

[Quert]

Your key points are good however, you need to study and evaluate many financial statements in order to understand the financial condition of a company, both on its own and within its industry: balance sheets, income statements, cash flow statements, and annual reports. In the story they tell when reviewed together, the meaning of these documents lies.

 

[Kingsley]

The financial statement you must understand includes those that will show the strength of the business this includes the cash flow statement, the balance sheet or comprehensive income statement and your must also understand the statement of profit and loss for the period. You must review this documents from time to time.

 

[Suba]

Often a company owner, in addition to requiring 3 main financial statements, also needs to know the statement of changes in capital as well as notes on financial statements, and the Bank Statement, in practice the owner always sees and analyzes sales reports every month.

 

[Kamon c4]

Well said! Balance sheet and income statement are very important when keeping records of business dealings. Also it’s very important to keep note of the trading profit and loss accounts. Trading profit and loss accounts evaluates the degree of profit and loss recorded in a business.

 

[Akinwale701]

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

I like the write up you have put up there. we must make sure that when operating business, we do things the way we are supposed to do it so that it would turn out that way we want. financial statements helps to know the financial position of a business at any given period of time.

Post automatically merged: Feb 1, 2021

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

I like the write up you have put up there. we must make sure that when operating business, we do things the way we are supposed to do it so that it would turn out that way we want. financial statements helps to know the financial position of a business at any given period of time.

 

[btaliat]

Generally when someone ventures into a business, one of the most important tasks is the bookkeeper or the accountant that manages and records the finance of the business. If you do not have the necessary skills to take on this task by yourself then you can revert it to another person that your employee, who is experienced and can handle such tasks as well.

Either way, whether you are handling it yourself or giving it to someone else to manage, you have to be able to understand some of the basic financial statement to ensure that you stay up to date with how your business is progressing. The three financial statements that I believe that you need to be versed in are:
1. The balance sheet - this shows yoru assets and liabilities of the business and ensures that there are no discrepancies
2. The income statement showing the expenses and the income of the business
3. The cash flow projection to show how cash is coming into and being spent from the business and may include future predictions as well.

Are there are other financial statements or requirements that you feel that an owner should be well versed in?

What an elaborate article. I have come across all these in school but I didnt even understand it. Maybe I understand yours because of its succinctly and well written. I can't wait to read your article on other financial statement that we have.

 

[Alexandoy]

For those small business owners with no background in accounting the best to use is the log book. It is a big notebook with a line at the middle. On the left is the incoming money like when there is a sale or when there is a payment. On the right portion of the page will be written the outgoing money like payments for supplies and other expenses. At the end of the period you will total all the items on the left and all the items on the right. The difference is the cash on hand that you will add to the previous balance of the cash.

 

[Seun4luv]

To understand a companies financial position both on its own and within its industry you need to review and analyze several financial statements: balance sheets, income statements, cash flow statements, and annual reports. The value of these documents lies in the story they tell when reviewed together.