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Foundations of Financial Statements
How are financial statements prepared, and who uses them?Preview the first lesson free — get full access to all 8 lessons.
Beginner Provider : Ruqayyah Archie 8 Lessons · 23m in Arabic, German, English, Spanish, French, Portuguese, Chinese
Course Description
This course will guide you through the process that accountants use to ensure that financial statements are accurately prepared and thoroughly reflect all necessary information. Accurate financial statements allow owners, managers, creditors, and investors to make financial decisions in relation to the company’s financial position. This course will explore how each of these internal users use financial statements, as well as how external users, like regulators, lenders, and creditors gain information about the business through its financial statements.
Accurate financial statements are the result of careful recording of all transactions that occur within a business. In this course, you will discover how the main financial statements are prepared, what benefits they offer to a business, and the information they provide. The main financial statements include the Balance Sheet, the Income Statement, the Statement of Owner’s Equity, and the Statement of Cash Flows. Each of these statements tells us something different about how a business operates and its financial position. You will learn how groups within and outside of the business use financial statements.
What You'll Learn
- Identify the major financial statements: the Balance Sheet, the Income Statement, the Statement of Owner's Equity, and the Statement of Cash Flows
- Understand the steps accountants follow to complete and prepare financial statements
- Recognize the internal and external users of financial statements
- Explain how each financial statement reflects a different aspect of a business's operations and financial position
- Describe how businesses and stakeholders use financial statements to make financial decisions
Key Takeaways
- Accurate financial statements are the result of careful recording of all transactions that occur within a business.
- The main financial statements include the Balance Sheet, the Income Statement, the Statement of Owner's Equity, and the Statement of Cash Flows.
- Each financial statement tells us something different about how a business operates and its financial position.
- Internal users such as owners and managers, and external users such as regulators, lenders, and creditors, gain information about the business through its financial statements.
- Accurate financial statements allow owners, managers, creditors, and investors to make financial decisions in relation to the company's financial position.
Frequently Asked Questions
What does this course cover?
It guides you through the process accountants use to ensure financial statements are accurately prepared, covering how the main financial statements (Balance Sheet, Income Statement, Statement of Owner's Equity, and Statement of Cash Flows) are prepared, the benefits they offer a business, and the information they provide.
Who uses the financial statements discussed in this course?
The course explores how internal users like owners and managers use financial statements, as well as how external users such as regulators, lenders, and creditors gain information about a business through its financial statements.
What skills will I gain from this course?
You will develop skills in Basic Accounting Principles, Cash Flow Statements, Financial Accounting, Financial Statement Analysis, Financial Statement Compilation, and working with Financial Statements.
What topics are included in the lessons?
Lessons cover an Introduction, Balance Sheets, Income Statements, Statements of Cash Flow, Building Financial Statements, How Businesses Use Financial Statements, How Stakeholders Use Financial Statements, and a Test Your Knowledge assessment.
