The financial statements of companies

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In analyzing the financial environment, the company needs a lot of information.This is necessary in order to head to make informed and reasonable decisions that affect the performance of the entity.The financial statements need to analyze the investment potential, to make lending decisions, as well as to identify risks associated with cooperation with suppliers and customers.

The company analyzes the financial environment generally deals with accounting.Its employees collect, sort, summarize documents for commercial transactions.These include:

- sale of goods and services;

- distribution of payroll;

- buying stocks;

- Other.

financial statements include a set of data, their classification and generalization.Documents can be prepared every quarter, six months or once a year.

In accounting, an entity is viewed as an organization that is independent from the owner of the goods, products sold, and paid wages.This distinction is very important for the understanding of what the financial statements and how it is made.

Private enterprise is usually controlled by a small number of participants, who are responsible only to themselves and are responsible for the bankruptcy of their property.Most often, this sole proprietorship (SP).Quite often, "SP-Schnick" are wondering whether they should keep accounting records?

In practice, the financial statements of the SP is formed due to a systematic and documented information.It is compiled on the basis of accounting statements.

Open Joint Stock Company (JSC) - a corporation that is managed by the management.It, in turn, reports to the board of directors, shareholders, monitoring bodies, whose shares are publicly available (for sale).

financial statements of includes two parts: the profit and loss account and balance sheet.The latter is a detailed state on a certain date (mostly, it is December 31).But some organizations are formed at the end of reporting sales.These are mainly those who work seasonally.Profit and loss account - a detailed accounting of money earned (lost) now for a certain period of time.

Limited Liability Company (LLC) - a corporation organized by one or more persons liable to the creditor only declared its capital.Its size is determined by law.

Ltd. Financial statements prepared by analogy with the Company.Presents the income statement and the balance sheet drawn up for a specific fiscal year.

Comparing documentation organization for several periods in a row, it is possible to identify trends in growth or, on the contrary - to the recession.Evaluation reports, including detailed, can help managers in decision-making.Comparative analysis with its previous results and averages is very important to characterize the financial condition of the company.