The financial statements that you must understand in your business

[Laurentta]

I agrew with you that these are financial statement every business should have but the thing is that most business don't keep to it especially small business, they don't have time for these kinds of paper work.

 

[Seno inyang]

It's essential to have records of expenses, supplies of products and the profit made on each item in order to know how to balance your finances in business and know where there is shortage too to balance the business financial flow.

 

[Adecyptii]

Thank you so much for the notice,you have already made mention of all the necessary steps that one has to know about financial statement.

 

[Elfinito]

Good write up there, you are really writing from experience and I have to say I have learnt a lot from this little piece from your knowledge

 

[Ghost]

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.

The ability to read and interpret might not be well known to you. One can easily employ staff for this purpose. They read and interpret then communicate with a language the manager can understand to him

 

[Trexxxy]

The ability to read and interpret might not be well known to you. One can easily employ staff for this purpose. They read and interpret then communicate with a language the manager can understand to him

Nice. I guess that is another way to go about it, after all there are people who are trained to do these things and as such their services should be engaged.

 

[HayKay]

The balance sheet might be a somewhat tall order for those who aren't that financially inclined but other records such as inventories and the other record you mentioned should be very well inderee.

 

[Godspower]

The balance sheet might be a somewhat tall order for those who aren't that financially inclined but other records such as inventories and the other record you mentioned should be very well inderee.

I took time to learn and understand the principles of a balance sheet before starting my business. It really helped me because I was able to determine the direction the business was heading when I started.

 

[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?

You have actually made a very good point which I'm going to elucidate more on the importance of having both your daily sales book which is regarded as your cash inflow book and also your expenses book because it is what you would require to use to balance whatever thing you do in your business.

 

[Syldan]

In understanding the structure, growth and development of every business company, is through bookkeeping. proper bookkeeping is a very essential element which determines and predict the growth of a company over a period of time. by keeping records of its profits and expenditure.

 

[Ghost]

Nice. I guess that is another way to go about it, after all there are people who are trained to do these things and as such their services should be engaged.

Exactly. The entrepreneur wouldn't only be creating employment opportunities for people, one would also be helping his or her business.

 

[greenie]

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.

 

[Sotherefore]

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.

Yes I know This is absolutely necessary , a business owner who does not know how to spot mistake in business accounting maybe at risk of being cheated on , there are a lot of dubious employees who are even ready to take advantage of your ignorance .

 

[GoldenLady]

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?

Most business owners would outsource this aspect of their business. It's mostly important though for the large scale business especially if you are interested in having external funding in the future.

 

[Grandeur]

Balance sheet, financial statement may be cumbersome to understand for someone who doesn't not have an accounting back ground but one should learn to understand the assets, liabilities, expenses and cash flow so as not to get cheated.

 

[Heatman]

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.

As a business owner an employee if you lack the knowledge of how to handle your finances very well it is always going to tell in your business growth because everything about business is all about money and finance.

 

[Syldan]

Bookkeeping is one of the most essential element in dealing with finance in any business organisation. This will helped you to know or have knowledge about the progress and challenges faced in your business.

 

[Heatman]

Bookkeeping is one of the most essential element in dealing with finance in any business organisation. This will helped you to know or have knowledge about the progress and challenges faced in your business.

This actually gives you a record on how your business is being operated from day-to-day so that you can be able to keep track of what is being done in your business whether you are growing or you are depreciating.

 

[CeeJase]

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.

When it comes to business finances it is something that should be taken very seriously because once anything goes wrong with your finance you are going to be in a very big mess with the business.

 

[Syldan]

Financial records are very important statements of which a business can not perform effectively without. They are statement which keeps the financial record of the performance and the lost of the business.