Bookkeeping All-in-One For Dummies, 2nd Edition

Chapter 1

Financial Report Basics

IN THIS CHAPTER

Reviewing the importance of financial reports

Exploring the different types of financial reporting

Discovering the key financial statements

Getting acquainted with the parts of the annual report

Looking at the three most important documents

Summing up the financial information

Financial reports give a snapshot of a company’s value at the end of a particular period, as well as a view of the company’s operations and whether it made a profit. The business world couldn’t function without financial reports. Yes, fewer scandals would be exposed because companies wouldn’t be tempted to paint false but pretty financial pictures, but you’d still need a way to gauge a firm’s financial health.

At this point in time, nothing’s available that can possibly replace financial reports. Nothing can be substituted that would give investors, financial ...