Understanding FinancialStatementsFinance
All the money your businessearns is not yours and all therevenues do not belong toyour business. Why is this so?
Because of a businessaccounting concept called‘Separate Entity’.
According to this, business andthe owner is considered as twoseparate entities. Due to this theowner is entitled to a mana...
What are financial statements?Accounting systems have emergedto organize book-keeping. Financialstatements are an outcome ...
Cash flow statement• Reflects the financial activity over a periodof time and also changes occurred in thebalance sheet.• ...
Income statement• Drafted to determine the net profit of thebusiness which further reflects in the balancesheet.• It inclu...
Balance Sheet• Quick overview of the assets and liabilities ofa business.• This statement speaks about different assetand ...
Other financial concepts anentrepreneur should know.Financial ratios to understand thecapital situation, cash flow situati...
Contact Us• www.utthistha.com• Blog : http://www.utthishta.com/blog/• Slideshare: http://www.slideshare.net/Utthishta• You...
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Understanding financial statements

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Understanding financial statements is an important aspect in running a startup company, more so if the entrepreneur isn't from a commerce background, not adept in financial issues. These slides give a brief overview of the financial statements that

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Understanding financial statements

  1. 1. Understanding FinancialStatementsFinance
  2. 2. All the money your businessearns is not yours and all therevenues do not belong toyour business. Why is this so?
  3. 3. Because of a businessaccounting concept called‘Separate Entity’.
  4. 4. According to this, business andthe owner is considered as twoseparate entities. Due to this theowner is entitled to a manager’ssalary and/or director’s salary.The most of ownership isrepresented by his/hershareholding in the firm.
  5. 5. What are financial statements?Accounting systems have emergedto organize book-keeping. Financialstatements are an outcome of thesesystems.For more details visit our blog: http://www.utthishta.com/blog/
  6. 6. Cash flow statement• Reflects the financial activity over a periodof time and also changes occurred in thebalance sheet.• This includes net cash flow from operatingactivities, investment activities, financingactivities and net change in cash andmarketable securities..For more details visit our blog: http://www.utthishta.com/blog/
  7. 7. Income statement• Drafted to determine the net profit of thebusiness which further reflects in the balancesheet.• It includes accounting categories like sales,cost of goods sold, gross profit, operatingexpenses, depreciation, operating profit,income taxes and other operatingexpenses.For more details visit our blog: http://www.utthishta.com/blog/
  8. 8. Balance Sheet• Quick overview of the assets and liabilities ofa business.• This statement speaks about different assetand liability categories like current assets,fixed assets, depreciation, current liabilities,accounts payable, owner’s equity and soon.• This is representation of the transparencyand level of governance in the businessholdings.For more details visit our blog: http://www.utthishta.com/blog/
  9. 9. Other financial concepts anentrepreneur should know.Financial ratios to understand thecapital situation, cash flow situation,break even analysis and debt situationof the firm.For more details visit our blog: http://www.utthishta.com/blog/
  10. 10. Contact Us• www.utthistha.com• Blog : http://www.utthishta.com/blog/• Slideshare: http://www.slideshare.net/Utthishta• Youtube: http://www.youtube.com/UtthishtaSeedFund• Google + https://plus.google.com/108795327446527541978/https://www.facebook.com/utthishta@Utthistha

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