Financial reporting is a key tool to assess a company’s performance and potential. These reports outline summaries of vital statements, like the income statement, balance sheet and cash flow statement, ensuring transparency for investors, lenders and management. The reports also provide insight to guide budgeting, forecasting and debt-to-asset financial ratio analysis. By following IFRS or GAAP standards, you ensure accuracy and consistency in your financial reports.
The income statement, or profit and loss statement, details the revenues of a business over a period, including sales, service revenue, and any other non-cash income, as well as expenses such as cost of goods sold, salaries, rent and utilities. The result is a gross profit or net income, which helps stakeholders assess profitability.
Using accrual accounting, this report calculates the amount of revenue and expense recorded by a business over the period, regardless of when cash is received or paid. It also presents a reconciliation of the ending cash balance with the beginning cash balance, displaying operating cash flows (e.g., cash from customer payments, purchase or sale of property and equipment) and investing cash flows (e.g., cash used to buy affiliate links, cash used for employee compensation and cash for financing debt issuance or repayment).
The balance sheet summarizes the company’s assets, liabilities and shareholders’ equity at a given point in time. Investors use it to evaluate a company’s liquidity and capital structure, while creditors analyze it to determine creditworthiness and assess risk before approving loans. Creating accurate and timely financial reports is critical to the success of your organization. Fortunately, Venngage offers ready-to-use financial report templates to simplify data presentation. These templates can be easily customized and downloadable to meet your specific needs. You can even automate your financial reporting with a solution like Fyle, which uses real-time credit card feeds to send receipts to employees via text message. Employees can simply reply with a photo of the receipt and the expense is automatically matched to the relevant transaction in your reports.
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