Understanding the finances of your business is essential to your business’ health. Financial statements are a summary of position, performance and changes in the financial position of a business.
They are essential for providing information on profitability, expenses and making decisions on investment whether in staff or equipment.
Businesses require four basic financial statements:
- Statement of Financial Position: This statement summarises the financial position of the business. The report provides information on a company's assets, liabilities, and Ownership equity at a given point in time.
- Statement of Profit & Loss: The Profit & Loss statement summarises the company's income, expenses, and profits over a period of time. This is one of the key statements of any business. The Profit & Loss statement includes sales and various expenses incurred when doing business.
- Statement of Changes in Equity: explains the changes of the company's equity throughout the reporting period.
- Statement of cash flows: This is, in our opinion the most important statement for any business; Cash flow is the lifeblood of any business and without it any business will die. The cash flow statement reports on the money flowing through a company. It is important that this statement is produced regularly and at a frequency that suits your business, whether weekly or monthly.
Financial statements can often be complex and confusing for business owners to compile or to understand. At KM Business services we provide accurate financial statements which are understandable, relevant, reliable and comparable. This is all created in a cost-effective manner.
Contact us today to discuss your needs - 0844 884 59 09.