/ / Preparation of financial statements

Preparation of financial statements

According to the law "On Accounting No. 113-XVI"The Russian Federation, adopted in 2007, is obliged to organize the preparation of financial statements at the enterprise, which is an integral part of accounting, its head. These requirements apply to all organizations and enterprises registered in the Russian territory.

The Benefits of Financial Reporting

The state attaches great importance to this issue. After all, regular and continuous preparation of financial statements provides timely and error-free miscalculationtaxes and their payment to the budget. That, in turn, contributes to the successful functioning of non-production structures. So, the state itself is developing and gaining strength.

In addition, a systematic correctthe preparation of financial statements contributes to the planned and successful development of entrepreneurial activities of the company, which, together with other enterprises, has a positive impact on the development of the entire economy of the country as a whole.

Having the opportunity to see the calculated monthlyfinancial result including processing and systematization of numerical data of all financial and economic operations carried out for this period in money terms, the director of the firm is able to correctly assess the financial condition of the company, as well as plan further actions to promote its business project.

What is financial reporting?

Financial reporting is a systematizeda set of monetary results, characterizing the financial position of the enterprise for a certain period. It is made using the accounts of plans in the accounting tables, journals, orders or other registers and contains the financial performance of the movement of goods or products, property, securities, and various, including tax, liabilities.

Usefulness of financial statements is defineda set of special indicators. The main elements of financial statements are groups or sections of accounting, such as assets, equity, liabilities, expenses, revenues, losses and profits.

Own capital of the enterprise, assets andliabilities are indicators of the available property and cash from the firm, as well as sources of financing in the reporting period. The remaining elements reflect financial and business operations that led to changes in both equity and assets and liabilities. Reflection of changes in the monetary form in all these elements is made using appropriate reporting forms.

Forms of financial reporting

The use of report types isrecommendatory character. Therefore, forms can be developed by the organization independently. PBU 4/99 sets out the general provisions and requirements for them. The following types of financial statements are used in the preparation of financial statements:

- a report on changes in fixed and working capital;

- balance sheet of the enterprise;

- a report on the purposeful use of funds;

- a report reflecting the movement of financial resources;

- attachment to the balance sheet;

- a statement of financial results that characterizes profit and loss.

It is also worth noting that small businessesbusiness, whose duty does not include the audit of financial statements, do not submit financial statements in the form of No. 3 (statement of changes in equity), in form No. 4 (cash flow statement), in form No. 5 (attachment to the balance sheet) and explanatory note. Of all the above forms, the main report is about losses and profits, as well as balance.