Nobody downloaded yet

Financial Statements - Essay Example

Comments (0) Cite this document
Summary
Financial Statements Abstract Financial statements represent the financial status of the firm. It is an important tool to assess the financial health of the organization for making projections based on such data. There are several individuals and organizations in the market that are directly or indirectly depended on the financial stability of the firm…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER96.5% of users find it useful
Financial Statements Essay
Read TextPreview

Extract of sample "Financial Statements"

Download file to see previous pages Financial accuracy and transparency is necessary for them as they would base their decision depending on the reports of the financial statement. The accurate representation of the financial statement would motivate an investor to invest, banks to lend money and the government to calculate the right amount of tax for the company. It also benefits the company by spreading their good name and increasing their goodwill in the market. Table of Contents Significance of Accurate Financial Statement for Outside Business Interest 5 Conclusion 7 References 9 Bibliography 10 Introduction The major motive behind creating a financial statement is to analyze the financial position of the company at the end of the year. It is very important to ensure that the financial statements are accurate, as the financial health of the company can be determined through the financial books of the company. It is a critical aspect for the business to create accurate statements because it is not only important for internal requirements of the company but also for the purpose of external reporting and expectation of the investors (Elmaleh, 2005, p. 105-106). The financial statements are the accounting reports which are used to communicate the financial information of the company to the external parties such as banks or the investors. If we consider it from the technical side, we can say that the financial statements help to summarize the processes in accounting and it provides a detailed tabulation of the accounting titles, and the amount of money. It not only indicated the financial position of the company, but also indicates the changes in the financial position from time to time in the organization (McCrary, 2009, p. 83-84). In the recent times, the two major areas that have been identified as the sources of inaccuracy are dishonesty and incompetency. So it can be said that if the organization wants to present a true and accurate picture of the firm, both to the internal and external stakeholders of the company, then it must take measures to remove both of the aforementioned inaccuracies from the financial statements. Financial statement which lacks accurate data because of data collected from unreliable sources would be considered incompetent. Financial accuracy begins right from the time of recording the financial statements. Compromise should not be done at the time of recording the information, as it really becomes difficult for the auditor to analyze and detect the actual figures. This may also lead to miscalculations and misinterpretation of data. It is the duty of the audit firm to conduct an audit of the financial statement and ensure the accuracy of the books. During the auditing process the accounting books and the financial statements are thoroughly checked, the inconsistent recording of financial transaction and record of the entity is also ascertained according to the principles of Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS), in the accuracy test. It is very important for companies to present an error free financial report to attract investors. Internal control system should be adequate to present a transparent image of the firm in the market. The internal control system would include the policies that organizations would adopt to prevent fraud, safeguard the assets of the firm and insert accuracy in the financial analysis. An ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Financial Statements Essay Example | Topics and Well Written Essays - 1250 words”, n.d.)
Financial Statements Essay Example | Topics and Well Written Essays - 1250 words. Retrieved from https://studentshare.org/finance-accounting/1453587-various-pick-one
(Financial Statements Essay Example | Topics and Well Written Essays - 1250 Words)
Financial Statements Essay Example | Topics and Well Written Essays - 1250 Words. https://studentshare.org/finance-accounting/1453587-various-pick-one.
“Financial Statements Essay Example | Topics and Well Written Essays - 1250 Words”, n.d. https://studentshare.org/finance-accounting/1453587-various-pick-one.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Financial Statements Essay

Financial statements

...?Superior Living is a manufacturing company that produces home furniture. The company’ target market is first time buyers between the ages of 21 to 54. The company currently generates $250 million in revenues. The firm is looking to expand its operations by introducing new product lines. Furniture is a product that has a huge marketplace due to the fact that all homes worldwide need furniture. A hot trend in the industry is the offering of green furniture which is furniture that is produced from renewable sources. A company that has exploited this trend in Europe and currently in the process of penetrating the US marketplace is IKEA. As the VP of finance of Superior it is my duty to prepare the financial...
3 Pages(750 words)Essay

Financial Statements

...? ACCT CASE 2: Financial ments October 14, Part I. • Generally Accepted Accounting Principles (US GAAP); Generally Accepted Accounting Principles are basically rules and concepts. The principles ensure that companies prepare their financial statements by complying with relevance, reliability, comparability and other related generally accepted accounting principles. The principles increase communication of financial data from the makers to the users of the financial statements within the United States (Wild, Shaw, Chiappetta, 2011). • International Accounting Standards (IFRS); The International Accounting Standards (IFRS) present globally...
4 Pages(1000 words)Essay

Financial Statements

...?Financial ments 8th, January, Introduction A financial ment can be defined as a record that shows the financial activities of a business, individual, or other entity. Financial statements act as indicators of the financial position of a company and are useful to different users wishing to make financial decisions. The four basic financial statements are balance sheet, income statement, statement of changes in equity, and cash flow statement. Financial statements are important and used by different...
4 Pages(1000 words)Essay

Financial Statements

...Financial ments: Fact or Fiction Financial ments are one of the primary ways that a company communicates its financial health to the public and its stakeholders. These statements may be used by auditors, tax revenue institutions, internal analysis, or evaluated for investment possibilities. The critical nature of the information demands that it be accurate and truthful. They are formatted and calculated using Generally Accepted Accounting Practices (GAAP). They must adhere to standards set by a government controlling body such as the Financial Reporting Council (FRC), the Accounting Standards Board (ASB), and the International Accounting Standards Board...
4 Pages(1000 words)Essay

Financial statements

...FINANCIAL MENTS Analysis of Financial ments and key components of Capital Project …………………………….. ……………………… Analysis of Financial Statements The fundamental goal of accounting information is to provide organizational and economic decision makers with useful information, because, financial statements are designed to assist the users in identifying key relationships and trends (William, Haka and Bettner, 2004, p. p. 602). This paper presents an analysis of various items found in the financial statements and it discusses key components of the capital project. The three key financial...
2 Pages(500 words)Essay

Financial Statements

...I. Essential financial information on the management of the enterprise The memo to the board will inform them that basic financial information will be submitted through the four financial statements that include income statement, balance sheet, statement of stockholders’ equity, and cash flow statement. The financial statements will provide the overall performance of the company, and where financial ratios can be derived and computed to analyze company performance. The introduction of the new spark plug manufacturing process in the Unites States, which is said to be very successful, will be confirmed and validated by the financial statements to be presented. While the financial statements will provide the overall financial health... of the...
8 Pages(2000 words)Essay

Forecasting financial statements

...Forecasting and Corporate Valuation s 12th August Forecasting Financial ments Danielsson wrote that when management takes decisions, it is important that consideration is given to their likely effects, and this is achieved by the preparation of forecasts, which set out the expected financial results of a proposed course of action. The first step in the process of forecasting financial statements is to determine the overall period to be covered in the forecast and the end date. The second step is to spell out the details to be contained in the forecast, to determine if the figures should relate to weeks, months or years, and the extent of analysis of receipts and payments. The third step is the area of activity to be covered... in the...
1 Pages(250 words)Essay

Financial Statements

...Company Google Source: http finance.yahoo.com/q/is?s=GOOG+Income ment&annual I. Gross profit margin Formula: gross profit total profit = gross profit margin expressed in percentage Year 2010 (number in thousands) Gross profit: 18,904,000 Total Profit: 29,321,000 18,904,000/29,321,000=.64 Gross profit margin : 64% Year 2011 Gross profit: 24,717,000 Total profit: 37,905,000 24,717,000/37,905,000 = .65 Gross profit margin: 65% Year 2012 Gross profit: 29,541,000  Total Profit: 50,175,000   29,541,000 / 50,175,000  = .588 Gross profit margin = 58% II. Operating income margin Formula: operating income/revenue Year 2010 (number in thousands) Operating income: 10,381,000   Revenue: 29,321,000  10,381,000  / 29,321,000 = .35 Operating... Google...
2 Pages(500 words)Essay

Financial statements

...Financial ments Exposure to financial ments Being the employee of a large textile entity, I have experienced a relatively greater exposure to the financial statements. My job is related to the sale of yarn for which I have to check out the financial statements of the previous periods. The reason behind checking the financial statements is to make a comparison of the existing sales performance with the previous period’s performance. Not only this, I also need to know the costs associated with yarn sales. Role for preparation of financial statements Due to integration of various departments in my organization, I closely work with accounts and finance department which is mainly responsible for the preparation of financial statements... . They...
1 Pages(250 words)Essay

Financial Statements

...of Home Depot as submitted to the United States SEC in the year 2008. The basic financial statements including the income statement, the balance sheet and the cash flow statements of the company are studied and mapped against the managerial decision making processes of the company in the specific year under study. Consolidated Statement of Earnings The consolidated statement of earnings of Home Depot indicates that the company has been extremely proficient in generating revenues in 2008. The total revenue in 2008 was USD 77349 million. The operating expenses of the company were USD 18755 million. This indicates that the company was...
6 Pages(1500 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Financial Statements Essay for FREE!

Contact Us