Our Financials (2024)

FAQs

How do you comment on financials? ›

There are many ways to evaluate the financial success of a company, including market leadership and competitive advantage. However, two of the most highly-regarded statistics for evaluating a company's financial health include stable earnings and comparing its return on equity (ROE) to others in its market sector.

They're a snapshot of your business performance—helping you run your company, plan its future, seek financing and much more. Financial statements are a key tool for running your business. They're a snapshot of your company's finances and give crucial information about your business performance.

Financial statements show how a business operates. It provides insight into how much and how a business generates revenues, what the cost of doing business is, how efficiently it manages its cash, and what its assets and liabilities are.

A company in good financial health will pay its bills on time and maintain good business credit. Analysis of financial performance metrics can be used to identify internal investment opportunities, like automating repetitive processes to increase productivity, and can help maintain positive cash flow.

Essentially, it means having enough income to cover your expenses without relying on credit or loans. If you are financially stable, you also likely have savings that can help offset unexpected expenses or pay for emergencies.

How do you explain financial statements? ›

Financial statements are documents that convey a company's business activities and financial performance. As the U.S. Securities and Exchange Commission (SEC) succinctly put it, “They show you where a company's money came from, where it went, and where it is now.”

Financial statements will tell you how much money you have, how much money you owe, your income, expenses, profitability, and cash flow.

Financial statements are written records that illustrates the business activities and the financial performance of a company. In most cases they are audited to ensure accuracy for tax, financing, or investing purposes.

The income statement, balance sheet, and statement of cash flows are required financial statements.

Many experts believe that the most important areas on a balance sheet are cash, accounts receivable, short-term investments, property, plant, equipment, and other major liabilities.

Use the balance sheet to review the financial condition of a business, as of a given period, by looking at how it manages its Asset, Liabilities, and Equity. Basic Equation of a Balance Sheet: Asset = Liability + Equity. Asset = Remember that an asset adds worth to a business.