Financial Statements

Do financial statements for your small business leave your head spinning and your eyes blurry? Financial statements, including the balance sheet, the profit and loss (income) statement, and the cash-flow statement, can help you identify problems and corrective action. A balance sheet is a list of the accumulated assets and liabilities incurred by your business. The difference between the assets and liabilities represents the net worth of the business. The profit and loss statement lets you know how the business did. And the cash-flow statement tells you where the cash was used. These statements show you what happened in the past, and they can help you make realistic assumptions for the future.