Accounting For Dummies, 5th Edition

Chapter 14

Filling Out the Financial Statements for Business Managers

In This Chapter

Recognizing the managerial limits of external financial statements

Examining the additional information needed for managing assets and liabilities

Identifying the in-depth information required for managing profit

Providing additional information for managing operating cash flow

If you’re a business manager, I strongly suggest that you read Chapter 13 before continuing with this one. Chapter 13 discusses how a business’s lenders and investors read their external financial reports. These stakeholders are entitled to regular financial reports so they can determine whether the business is making good use of their money. The chapter explains key ratios that the external stakeholders can use for interpreting the financial condition and profit performance of a business — which are equally relevant for the managers of the business.

Business managers should understand the financial statement ratios in