— Kishore V, SME and ACW at Edumarz
The objectives of preparing financial statements are:
- A financial statement provides timely and reliable information on the economic status of a company on a periodical basis. It also makes information available to external users or stakeholders who do not have direct access to the information.
- A financial statement helps in revealing the true financial position of a company. It contains information related to liquidity, profitability, financial viability and solvency of an organisation.
- A financial statement is helpful in evaluating the earning capacity of a firm.