How to read those statements. We can make it soooo easy!!
A critical MBA skill is clearly the ability to attempt to assess the financial health of an organization. There are three major documents to consider:
- The balance sheet. This is a ‘point in time’ picture of the health of the company concerned.
- The profit and loss account. This illustrates whether an organization is making money and making profit.
- The cash-flow statement. This identifies where the cash is, and cash clearly is different to profit.
We’ll expand on each of the above terms fully in a moment, but…
- Firstly, most MBA students will not get much further than being competent amateurs with accounting – unless, of course, that is their chosen profession. And ...