If you don’t know pretty much about the financial report and you would want to find out more about the ways in which people use it then it might be the time to sit comfortably on your chair and read the following lines in which we will explain to you what this term means and why it is so important to people.
You should know this concept is also termed as financial statement and it represents a formal report of the financial activity belonging to a business or a person.
In the case of a company or corporation, the financial statement refers to a statement of the financial position, a statement of the profit and loss, a statement of change in equity and a statement of cash flow activity. Usually, these financial statements of a company point out whether the business is profitable in a given period of time like a year, six or three months. You should know though that for a more extended business which includes a large corporation, additional financial reports may be requested accordingly to the complexity of the financial activity.
The financial reports are very important for the persons that occupy leading positions in a company and that have to decide on different things that could affect the future activity of the company.
If you want to get a better idea about these reports it is always a good tip to go to Google Finance and find out more about different companies and corporations’ financial performance by following their financial statements this online service provides to its users. You should know that the financial reports of companies are requested even by the tax institutions in order to follow the accuracy of some taxes being paid by companies.
If a company needs to address to a bank in order to get a capital loan, then the bank will surely require the company to provide it with a financial report of its financial activity. Among other parties that need to consult financial statements we should also mention different investors that need these reports in order to decide whether it is safe or not to invest their money in a certain company.
When it comes to the personal financial report you should know you need this financial accounting when you want to get a bank loan you need in purchasing something that you can not afford paying for from your monthly earnings. In this case, the financial statement refers to presenting to the bank your income and expenditures which should offer clear information on the money that remain in using for paying credits.