Annual financial statements are very important as they provide you with a lot of information about your company and its future.
Annual financial statements can provide you with information such as earnings and if they’re higher or lower than the previous year, how sales are doing and whether the company is making more money than what it is spending. All these numbers should be clearly represented on a company’s annual financial statements.
Annual financial statements are a good indication of where the business is at financially and is useful in determining an estimate at how the business will do in the following year. It can also give a good idea of the management’s strategic plans and will let you know how management plan to build on the company’s current success, of improve on its failure if that’s the case. These statements can help management make intelligent decisions on what’s working and what isn’t in order for the business to succeed.
Annual financial statements are also important for investors to analyse investment potential and good financial statements help banks determine whether or not to loan money to a company. An annual financial statement can also help a company decide whether their customers and suppliers are going to be a good or bad risk to do business with.
An annual financial statement is the one document within a company that says “Take a look at what we do, what we’ve done, and what we will do.” Investors, banks, clients, and potential customers all rely on a company’s annual financial statement to determine how doing business with that company is going to help them. A company’s annual financial statement is usually readily available for perusal from the company itself or on their website and it is almost always free for investors, banks and a range of other people to have a look at.
The Close Corporations Act requires that companies provide annual financial statements and they are required to be in agreement with all accounting records of the company. If you and your business requires help with this, we at PATC can help you. We will work with you in order to provide an accurate annual financial statement of your company.
For more information on how we can help you do this, please contact us.
Image courtesy of FreeDigitalPhotos.net
