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Financial Statements: Fabm 2

The document discusses the main financial statements used by businesses: 1) The statement of financial position provides a snapshot of a company's assets, liabilities, and equity at a point in time. 2) The statement of comprehensive income shows the revenues and expenses over a period of time. 3) The statement of changes in equity outlines the changes in owner's equity from the beginning to the end of the period. 4) The statement of cash flows provides information on the cash transactions of the company during a period.

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Earl Hyannis Elauria
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38 views14 pages

Financial Statements: Fabm 2

The document discusses the main financial statements used by businesses: 1) The statement of financial position provides a snapshot of a company's assets, liabilities, and equity at a point in time. 2) The statement of comprehensive income shows the revenues and expenses over a period of time. 3) The statement of changes in equity outlines the changes in owner's equity from the beginning to the end of the period. 4) The statement of cash flows provides information on the cash transactions of the company during a period.

Uploaded by

Earl Hyannis Elauria
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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FINANCIAL

STATEMENTS
FABM 2
FINANCIAL
STATEMENT
1. Statement of Financial Position
2. Statement of Comprehensive Income
3. Statement of Changes in Equity
4. Statement of Cash flow
5. Notes, comprising a summary of
significant accounting policies and other
explanatory information
Owners/Man
agers

Financial
PURPOSE Employee
Institution

Investors
PURPOSE OF FINANCIAL STATEMENTS

Financial statement may be used by users for different purpose


1. Owners & Managers – make important business decision
that affect its continued operations
2. Employee – to make collaborative bargaining agreement s
with the management in case of labor unions or for individuals
in discussing their compensation, promotion and ranking
3. Investors – to assess the viability of investing in a business
4. Financial Institution – decide whether to grant a company
with fresh working capital or extended debt securities
FINANCIAL
POSITION
this statement literally presents a
company’s “position” when it
comes to the resources it owns
(assets), obligation claimed
against it (liabilities) and the
owner residual interest (equity)
COMPREHENSIVE
INCOME
This statements presents the
revenues and expenses incurred by
the company for a period of time
CHANGE IN EQUITY
The SCE tells the reader about the
beginning stake of the owner
(beginning capital), any additional
investments, withdrawal of
resources and share in net income
or net loss.
CASH FLOW
The SCF tells a specific story
about the cash transactions of the
company.
NOTES
TITLE CONTENTS DATE
Statement of Financial Assets, Liabilities and For a point in time
Position Equities (“as at” or “as of”)
Statement of Revenues and For a period in time
Comprehensive Expenses ( For the period ended)
Income
Statement of Changes in Transactions For a period in time
Equity involving owners ( For the period ended)
Statement of Cash Flow Transactions For a period in time
Involving cash ( For the period ended)
Explanatory Notes Other Information N/A
What are the different financial
statements and how do they help
in the decision making of a
business?
Thank you

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