Financial statements are the legal documents that shows the position of a company. Every company small or multinational has to produce these every year. Some do it every three months but small companies produce them annually only. If you are running a business anywhere in the world there are couple of things that you need to know about these financial statements.
It is your scorecard
Score cards are where you show up your credentials to get more points. Except in business financial statements are your score cards and points are your investors. Every business needs shareholders to invest in the business. Your shareholders look in to your annual reports and the financial statements to evaluate the profitability of the company. These statements have to be certified by an auditor, if you are a company in the free zone there are plenty of audit firms in Dubai airport free zone where you can get your financial statements certified. You need to make sure you provide accurate details and you record everything, because your investors do a thorough check before they invest in your company. It is important to present the statements in a very simple and a very clear way to make it easy for them to understand. If you are a private company only the people you select can see your financial statements, but if you are a public company your financial statements can be viewed by anybody.
You need the auditor’s report
When it comes to financial reports, you need the auditor’s report to validate your statements as well as get an opinion on the company. Most investors only invest in companies who produce this report. So if you need to get more investors to be interested in your company you need to get one of the audit firms in Dubai UAE to provide you a report. Most investors are afraid to invest in free zone companies. An auditor’s report may go a long way in getting investors.
One template doesn’t fit all companies
Most of the time people make the mistake of thinking all the financial statements should look the same and should contain the same information. But this is not the case. Based on the type of the business the content of the financial statements may change. For example if you are in a group of companies then your statements would be called a consolidated financial statements. Which means it is a compilation of the group. But if you are a single company then this won’t be mentioned.