What other financial documents, besides the Profit and Loss statement, are important?
Other the Profit and Loss Statement (or P&L statement), there are other documents that are also important for a company. The P&L Statement is actually just one of the four basic financial statements required by the accounting standards and the business world. The other financial documents are the balance sheet, the statement of changes in equity and the statement of cash flows, which are explained as follows. If the P&L Statement shows the company’s performance for a given period of time, the balance sheet shows the company’s financial position at a given point of time (usually as of December 31 of every year). If the P&L Statement is the income statement, the balance sheet is the statement of financial position. The balance sheet shows the assets of the company or those financial resources owned by a company such as its cash, receivables (amounts owed by the customers to the company), inventories, property and equipment such as land, building and machineries and any expenses paid for
