A good financial statement is of great importance to every person and business. Whether for your business or personal finances, without the information that is on a financial statement, it is nearly impossible to determine what your true financial position is. It is also imperative if you are making plans for future growth of your business – this will include any expansion or growth sectors that you are anticipating. This is why a quality statement is important if you want to get the most out of this practice. Below are some checkpoints business owners can use to make sure they are on the right track.
Tip: Be conservative on your estimates, and make sure it is organized in order to benefit you and those reading it.
- Income Statement
- Revenues/expenses/profits and loss/operating entity
- Balance Sheet
- Assets/liabilities/equity of your entity
- Statement of your Cash Flow
- Cash flow sections of your business
- In and out expenses that are fixed and anticipated
- If you take retained earnings, render an estimate
If you show major differences from one year to the next, then check your numbers and adjust accordingly.
-Stephen Capper, A-1 Awards
