Showing significant growth is crucial for startups to attract more investors. Thus, some companies focus more on sales and product development than bookkeeping in the early stages. These situations make companies do not have reliable financial reports. Having a precise financial statement is vital for the sustainability of your business. A clear financial report will support you in making decisions for the company, making projections, and calculating the return on investment. It helps you know your finance positions and prepare plans precisely. Without financial statements, projects will run with no clear investment return on investment and no information on how resources are allocated.
Financial statements contain crucial information about a company's financial health. It shows the company's conditions financially that will affect the business activities and investor decisions. A clear financial report will support you in making decisions for the company, making projections, and calculating the return on investment. These are four main financial statements that should be prepared regularly:
Balance Sheet
Income Statement
Statement of Cash Flow
Shareholders' equity
These reports contain important information that can detect a company's financial health. There are many metrics that you can use to evaluate.