A financial report is a formal document that captures all significant financial activities for your business in a given period. The data it provides helps with strategic decision-making and legal compliance. Whether it’s analyzing profit margins to identify inefficiencies or forecasting the impact of new projects, your financial reporting is vital for your stakeholders to understand your company’s health.

Depending on your business, you may have various financial reports that include the following:

Profit and loss statement

A P&L (profit and loss) statement details revenue, operating costs and net income for a specific period. Investors use it to gauge sustainability and profitability, while lenders review it to assess a company’s creditworthiness before approving loans.

Balance sheet

A balance sheet is a snapshot of what your company owns (assets) and what it owes (liabilities and shareholders’ equity). It offers a 360-degree view of your business and provides visibility into the financial stability, liquidity and capital structure.

Cash flow statement

A cash flow statement tracks money inflows from operations and investments and outflows for expenses, business activities and financial commitments. It highlights your business’s reliance on external funding and reveals areas where you can improve cash management.