CPA Firm Los Angeles » Financial Statements

Financial Statements

Increasing the profits of your business starts with a sound understanding of financial statements. The financial tool, along with other financial reports, is vital for properly managing your business activities, particularly as it concerns the following:

  • Guiding the day-to-day operating decisions of your business
  • Providing proper confirmation for figures used in tax returns
  • Providing financial records of past performance to facilitate bank loans

Financial reporting continues to get more sophisticated in today’s world, especially as the business arena is dynamic.

Asad Chaudhry has the necessary expertise to supervise or prepare, review, and audit your financial statements to meet your needs.

What We Offer

Here’s a brief overview of the types of financial statements we prepare:

  • Income Statement: This report shows your total revenue less your expenses for a given period.
  • Cash Flow Statement: This shows you the different cash sources and how you’ve used them in any particular period. It indicates your company’s ability to pay its bills.
  • Balance Sheet: All your assets and liabilities for any given period, including the equity of your business, are listed in this financial report.
  • Statements of Retained Earnings: This report shows you how much money your business has left after withdrawals and dividends have been paid.

Our Operative Modalities

We prepare financial statements every month. Doing so will enable you to have quick access to financial data required for year-to-date comparisons.

For example, you may want to compare your gross and net profit for a particular month with records of previous months to guide your management decisions. You can also discover problems and act quickly by comparing the totals of your various accounts in the current year to a previous one.

We can prepare your financial records to help you keep tabs on your business ratios, such as:

  • Current ratio: This ratio lets you see at a glance whether you can pay your current debts. The financial tool divides your assets by your current liabilities to arrive at a high ratio (meaning you can pay your creditors) or a number less than one (indicating that your business has potential cash flow issues).
  • Profit margin: This tells you how much money your business is making by showing you the exact revenue dollar coming into your bottom line. It divides your gross profit by net sales, enabling you to check the financial health (profitability) of your business.
  • Receivables outstanding: This refers to the total amount owed or promised but not yet received by your company, or all outstanding invoices. Dividing the receivables by your average day’s sales results in estimated outstanding accounts receivable.
  • Debt to equity ratio: This ratio shows your ownership of the business by dividing your company’s total liability by its net worth or shareholders’ equity.

Although the proper use of financial statements can dramatically boost profitability, we understand that not every business owner has in-depth knowledge in that regard. But we are glad to assist you in learning how to use the report to make sound business decisions.

Feel free to contact us if you need help with preparing your financial statements and other financial reports. Plus, you can ask us anything relating to your business numbers, and we will be happy to provide you with clarifying answers.

Contact Us!

Please fill out the form below so that we can help you. We will get back to you as soon as possible.

 

818-488-2056