Other financial reporting

Accounting is one of the sciences that has served human society since ancient times. This knowledge always deals with information that plays an important role in the productivity of human life. Knowing the basic concepts of accounting and applying it will certainly play a special role in economic goals.

As a result, in the rest of this article, you will learn how to prepare financial reports, which is one of the most important activities in accounting. In fact, accounting can be considered as the science of expressing calculations in the language of accounting and preparing financial reports. Certainly, the importance of financial reporting can be understood from this point.

The general purpose of this article is for those interested in accounting to become familiar with the principles of accounting and how to prepare financial reports and implement it in their small institutions.

It is clear that financial statements should include assets, liabilities, income, expenses, equity, cash flow in the company, etc. over a period of time. Financial reports have three types of time periods; First quarter financial statements, semi-annual financial statements and one-year financial statements.

As mentioned at the beginning of the article, preparing financial statements is one of the most important tasks of an accountant; Because he must use these reports to make the company's financial information easy for the public to understand.

Financial reports prepared in each institution must be recorded in the legal offices; For this reason, one of the most important documents of any company is the financial reports of that company and great care must be taken in its preparation.

Benefits of preparing periodic financial statements

Those who are unfamiliar with accounting and its principles but are active in the stock market are well aware of the benefits of financial reporting.

Types of financial reports

Balance sheets are called financial statements because the balance sheet contains accurate information about the amount of debt and assets of a collection.

The general view of the balance sheet is that the assets of the collection will be mentioned on the right side of the balance sheet; Also on the left side of the balance sheet will be the amount of debts. Finally, at the end of a balance sheet, the amount of shareholders' salaries will be mentioned.

The comprehensive income statement is a set of operating income and expenses, not non-operating expenses. As a result, the preparation of this financial statement is done when no interest has been deposited in the account of the shareholders. Compiling a comprehensive income statement is useful when a collection needs to be modified.

This balance sheet is very important for companies in the capital market; Because based on observing the same balance sheet and examining its profitability or loss, investors will invest in a set.

These reports will usually be submitted at the end of the fiscal year and are not mandatory; But if the collection has been offered in the stock market, its presentation will be mandatory. In the profit and loss reports, the company's sales, assets, current expenses and the like will be mentioned.

It is based on these financial reports that analysts will predict the profitability of a group, and as a result of this analysis, many people will buy or sell shares of a company. In the financial statement of profit and loss, items such as income, expenses and the amount of profit of a collection will be mentioned.

The activities and resources through which cash is generated for a collection are of great importance to a collection; So like the heart to man, finding these resources is important and necessary for a collection. Finally, this financial statement shows the sources through which cash is generated and the sources through which cash is lost.

To accurately compile this financial statement, in addition to using a professional accountant, you must also use useful software in this area. Examining the financial statements of a collection is very important for the creditors of a collection because they can see how well a collection is able to pay the repayments based on the cash flow statement.

Finally, this financial statement shows the flexibility of a collection and the strength of a collection to repay loans.

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