Financial Report Types Notes

Financial reports are important tools for companies, investors, and other stakeholders to understand
the financial health and performance of a business. Here are some of the common types of financial
reports:

Income Statement: Also known as the Profit & Loss Statement, it shows the revenue, expenses, and
profit/loss of a business over a specified period of time. It provides insight into the company’s ability
to generate income and manage expenses.

Balance Sheet: This statement provides a snapshot of the company’s financial position at a specific
point in time. It shows the company’s assets, liabilities, and equity, helping to assess the company’s
solvency and ability to meet its financial obligations.

Cash Flow Statement: The cash flow statement provides information on the inflow and outflow of
cash for a business over a specified period of time. It helps to understand the company’s ability to
generate and manage its cash resources.

Statement of Changes in Equity: This report shows the changes in a company’s equity over a
specified period of time, including the impact of net income, dividends, and other equity
transactions.

Financial Ratios: These are calculations that help to assess various aspects of a company’s financial
performance and position, such as liquidity, profitability, and solvency.

Auditor’s Report: This report is prepared by an independent auditor and provides an opinion on the
accuracy and reliability of the financial statements.

It’s important to note that financial reports are often prepared on a regular basis, such as monthly,
quarterly, or annually, to provide stakeholders with timely and accurate information.