1. financial Statements

= share information to collectively present financial information

1. Balance Sheet

2. Income statement

3. Statement of cash flows

4. Statement of shareholders’ equity

5. Notes to the financial statements

= financial position

At a point of time

List of: Assets, liabilities and shareholders’ equity

• profitability

• Outcome of using assets to generate earnings

• Reporting period

• Helps explain the change in retained earnings on the beginning and ending balance sheet

• Cash inflows and outflows

• From operating, financing and investing activities

• Explains the change in cash on the beginning and ending balance sheet

• reasons why the components of SE increased or decreased

• During a reporting period

Provide additional information

Schedules & Notes

• describe the accounting guidance

• Elaborates on or disaggregates items presented in the financial statements

• Revenues - when cash is received

• Expenses - cash paid

• =/= accepted principals

• Transactions are recorded in the periods in which the events occur

  • Revenues = goods sold, services performed - even if cash not received

  • Expenses = when incurred

Balance sheet - permanent accounts - remain open - nonzero balance at the end

Income statement - temporary accounts - zero balance at the beginning and at the end