Financial Management Is Important To Organizations In Order

In accounting there is much to be learned, about the financial aspects of a business. In the past five weeks I have learned the importance of financial reports and how they relate to the success of an establishment. These reports may include balance sheets and income statements, which help accountants and the public grasp the overall financial condition of a company. The information in these reports is really significant to, managers, owners, employees, and investors. Managers of a business can take and deduce financial

A balance sheet gives an overall picture of a company's financial situation by showing the total assets of a business, including liabilities plus equity. Current assets can include cash, accounts receivable, inventory and prepayments for insurance. The balance sheet is used by investors to get an idea of what the shareholders have invested, including

* A balance sheet is snapshot of the financials for that organization (with assets on the left and liabilities on the right side) for that particular date that was requested

The purpose of this paper is to define accounting, and identify the four basic financial statements. The paper also explains how the different financial statements are interrelated to each other and why they are useful to managers, investors, creditors, and employees.

The income statement (IS) also known as the profit & loss statement provides the net gain or net loss of a business entity. The importance of the income statement is to evaluate profitability of a company (Finkler, Jones, and Koyner, 2013). The best use of the IS,

The statement of cash flows reports the cash receipts, cash payments, and net change in cash resulting from the operating, investing, and financing activities of a company during a period in a format that reconciles the beginning and ending cash balances

Financial statements depict a picture of the financial well-being of a business and are used for financial performance analysis (Nelson, 1942; Stichler, 2008). First, the statement of financial position consists the assets that are owned by the HCO, the liabilities that the HCO has to the outsiders, and a portion of the HCO’s assets that belong to its owners (Finkler et al., 2013). It is a balance sheet indicating what the HCO has and what the HCO owes at a specific

Again, financial statements are effective tools in helping organizations determine their financial positions in the health care industry. The use of balance statements help determine the amount of assets, liabilities, and equity over long term, while statements of revenue and expenses provides an overview of profits minus expenses short term. In the case of Patton Fuller Community Hospital, per the admission of the CEO, the facility suffered a financial loss; however, with patient net revenue up, they expect future financial statements to show a continued profitable

Understanding the finances of a company is important but knowing the significance of the financial statements is crucial to the operations as well. Reviewing the statement of financial position, operating statement and statement of cash flows serve as a guidance to management and executives on the day-to-day activities of an organization (Finkler et al., 2013). For example, the statement of financial position (balance sheet) shows the assets and

Financial Statements are very important part when running any type of organization. Looking at the statements it provides a very good view in how to understand an organization financially. The balance sheet has three key points: assets, liabilities, and a net assets. When summing the liabilities and net assets should always sum equally to the total assets. Investors will use this type of information in order to determine an organization’s financial conditions. When using the balance sheets it lets the person have a quick review of what the assets, liabilities, and net assets in were they are distributed within the time fame. A single step income statements uses revenues, expenses, and the net income and using the multi-step income statements provide information on how the operating and the non-operating system work. The community hospital had there up and downs between the year 2012

The “financial statements are formal reports providing information on a company's financial position, cash inflows and outflows, and the results of operations” (Hermanson, p.22). There are four main components that make up a financial statement. The four parts are, balance sheet, income statements, cash flow and, statement of owner’s equity. The balance sheets role is to define the company’s assets liabilities and revenue of the business. The income statement shows the income within the company. Cash flow reviews the position of the company by cash payments and receipts. Lastly, the statement of owner’s equity shows the amount of earnings, stock and other capitals of people in the company. (Hermanson, p.34-35).

A balance sheet provides detailed information about a company's assets, liabilities and shareholder's equity. The balance sheet is based on the following accounting model: assets equal liabilities plus equity. Assets are the things a company owns that have value. Liabilities are amounts of

A financial position is often presented to an organization for comparison of a previous year financial position. Financial positions also provide information about resources, obligations to creditors, and equity in net resources. The operating statement is also known as the profit and loss statement. The operating statement is a summary of transactions of an organization and indicates whether the organization made a profit or loss during a particular time frame. The profit of an organization is the excess of revenue over expenditure. Revenue reflects the company’s income generated from its profit activities which are known as the positive cash flows. The decrease expenses in the company’s asset results in negative cash flows. The net income and profit is the difference between the positive and negative cash flow. Cash flow statements are statements that allow organizations to determine if the company is making money from its core operations or financing itself through debt. The cash flow statement of an organization has three components that determine what enters or leaves the organization during a specific time frame. The three components include core operations, investing activities, and financing activities.

The balance sheet is the descriptive interpretation of the assets of what Andrews Company owns (assets), what it owes to the creditors (liabilities) and the contributions from the investors and (equity). Thus, Assets = Liabilities + Equity

Balance sheets are prepared by organizations to provide a snapshot of the company’s financial position. Balance sheets provide unique insight into the financial health of an organization. The importance of an accurate representation of financial standing cannot be overstated. Business leaders must have a firm grasp of the details found in a balance sheet in order to successfully determine if additional work is required. Leaders of corporations are obligated to understand the differences found on balance sheets prepared according to US GAAP and IFRS, have a solid understanding of terms used on a balance sheet, and successfully compare balance sheets from different organizations to determine which is in better standing.