A Study of the Financial Statements of 'Superior Living'

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Slide 1: The next 12 months are expected to be a major turning point for Superior Living. We are expecting our IPO, and on top of that we expect to engage in some merger and acquisition activity. That creates a lot of work for the finance department. In order to ensure that we are making the best contributions to these decisions, we need to have a good sense of where our company is going. With the IPO coming in particular, we need to produce financial statements in accordance with generally accepted accounting principles. This presentation will cover over these statements and how they are produced, and what they contribute to the decisions that Superior Living will face in the coming months. Slide 2: There are four main financial statements, and we will highlight the most important three of those in this presentation. The fourth one, Statement of Shareholder's Equity, is something we will worry about more next year, after the IPO. Prior to the IPO, we will have to produce the big three: income statement, balance sheet and statement of cash flows. We already produce rough versions of these three, but these will become much more important. Slide 3: Financial statements for public companies are compiled according to Generally Accepted Accounting Principles, or GAAP. This is mandated by the Securities and Exchange Commission as a means of ensuring that companies produce these statements consistently. That allows investors to easily compare different companies when they are
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