In the financial statement of a company, the numbers are a reflection of events that occur in the real world. The indicators and financial ratios derived from them are better understood if you are able to see the realities underlying. Essentially, this information is quantitative. For instance, before your accountant Melbourne even begins to crunch numbers, understand what the company’s services are, its products and what it does as a whole. Also understand the way it operates in the industry.
When it comes to financial statements, generally the ones utilised by a company are the cash flow statement, the income statement and the balance sheet. The statements of retained earnings and shareholders equity are not always presented contain information that are not critical but rather, are nice to know. Keep in mind that the statement for cash flow contains analytical data that are critically important.