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The 3 Fundamental Financial Statements

The financial statements—the balance sheet, income statement, and cash flow statement—are an important means by which timely information is provided to managers as well as to investors, creditors, and other users of financial statements. Each statement furnishes a different type of information. Each is useful in its own right; however, understanding how the three are linked is vital to assessing a company’s strengths and weaknesses. Together they provide a fuller picture of a company’s current financial status and offer a glimpse into its future. In this chapter, we will describe what each statement does ...

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Cover of Financial Literacy for Managers: Finance and Accounting for Better Decision-Making

Note

To get a true financial view of your department or organization, you need to analyze it from different perspectives. Three types of financial statements−the balance sheet, income statement, and cash flow statement−can provide a complete analysis of financial performance. Learn about the information that each statement provides.