Why prepare Financial Statements

I often get quizzical looks from agency owners questioning the need for financial statements. They are comfortable looking at production reports and their bank statements and occasionally analyzing their Income.Expense statement to get a feel for profitability. But through what lens are they are looking through?

It is a little known fact that financial statements can be run in various ways depending on the end-user. Are you providing the statements to a bank for a LOC? To potential investors? What is on the statement that these users are looking at? Do you know what is on your Balance Sheet? Do you know how your cash is being utilized?

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Susie Nicastro