Accountants use financial statements for measuring and monitoring business performance, as evidence of a business’s value, and at tax time.
The three most important financial statements are the balance sheet, income statement and statement of cash flow. The balance sheet is a snapshot of a business’s financial position at a point in time. The income statement provides a summary of revenue, expense and profit for a defined time period, usually a month, quarter or year. The statement of cash flow is a summary of cash inflow and outflow by source for a defined period. Read more