Financial Statements Paper Essay

The statement usually includes beginning balance, net income for the latest cycle, dividends disclosed in the current period and ending balance. Balance sheets stop assets and claims to assets at a distinct point in time. Claims of creditors and claims of owners ar examples of claims to assets. This special(a) statement volunteers a clear outline of the financial standing of the beau monde as a whole. The direct function of a statement of property flow is to present financial info such as capital receipts and pay upments during a set point in time.This assists investors and creditors to analyze a companys financial position.. These statements address a companys financing, investment and operational activities. financial statements are useful to managers as these statements are utilized to measure the performance of the organization. Sales and expenses are compared to the income statements from previous periods by vigilance to pinpoint possible problematic areas. Major va riations adjure management to thoroughly understand what the causes of those changes are.Variations in liabilities and assets are examined on the balance sheets from peerless cycle to the next. Any large variations need to be identified, explained and reasons established to whether the variations benefited the company, or caused a loss as consequences of problems. From this point management can need adjustments to correct any problems, or future planning, so these losses or problems do not repeat again. The benefits can be capitalized upon as well.Financial statements are useful to employees for the reason of collective bargaining, discussing compensation, and ranking. Employees also use this information as a means to determine the ability of the company to provide retirement benefits and opportunities for advancement. Financial Statements are useful to investors as they hold an vex in the profits of the company. The investors are looking for a return in the money they have inves ted, usually in the form of stocks, as they hear increases in stock value and profitability.Lending decisions to be made by creditors are based upon the financial statements. The creditors want to ensure that the companies they are lending the funds to have the ability to manage its finances so they are not at risk of not being able to pay back its debts. References Kimmel, P. D. (2009). Financial Accounting Tools for Business Decision Making (5th ed. ). Retrieved from The University of genus Phoenix eBook Collection database..