What Are Financial Statements?
Financial statements help show how your business has performed and what its financial position looks like.
The reports you will commonly hear about include:
- Profit and Loss Statement — shows income and expenses and whether the business made a profit or loss over a period.
Balance Sheet — shows what the business owns, what it owes and its overall financial position at a particular date.
Cash Flow Statement — helps explain how cash has moved through the business.
Why Are They Useful?
Financial statements shouldn't simply be documents you receive at the end of the year and put in a drawer.
They can help answer important questions:
Is the business profitable?
Are expenses increasing?
How much does the business owe?
Is there enough working capital?
Has the financial position improved?
Can the business afford its plans?
They may also be needed for taxation, finance applications and other business purposes.
How SKC Accounting Can Help
Depending on your needs, we can assist with:
annual financial statements
Profit and Loss Statements
Balance Sheets
Cash Flow Statements
supporting schedules
year-end accounting
financial statement review
explaining important results in plain English.
Common Questions
Can't find your question? Email us.
What's the difference between profit and cash?
A business can make a profit and still have cash-flow problems. Profit measures financial performance; cash tells you what money is actually available.
This is one of the most important differences for a business owner to understand.
Do I only need financial statements once a year?
Not necessarily. Annual accounts may meet a particular compliance need, but some businesses benefit from reviewing financial information more regularly.
Continue Learning
How Do I Read a Profit & Loss Statement Without Being an Accountant?
What Is a Balance Sheet — and Why Should a Business Owner Care?
What Is a Cash-Flow Statement — and What Is It Telling Me?
Revenue, Gross Profit, Net Profit and Cash — What's the Difference?
Service Delivery Disclosure
SKC Accounting Financial & Advisory Services Pty Ltd trading as SKC Accounting is a licensee of Platinum Accounting Australia Pty Ltd (Platinum). Platinum is a Registered Tax Agent (Tax Agent No. 24683431). Tax agent services, including the preparation, review and lodgement of tax returns, and BAS/GST services requiring registered-agent authority, are provided through Platinum under the applicable engagement arrangements. For more information, please visit Platinum Accounting Australia.
Let’s Talk About Your Business
A useful first conversation starts with what your business does, what is creating pressure and what you would like to improve. Book a Complimentary Initial Consultation to discuss the support that may suit your circumstances.