Preparation of Financial Statements
Financial statements have a variety of valuable business uses. They’re a good gauge of the overall health of a business and a necessary input when you’re:
- Preparing Your Taxes.
- Planning to Sell Your Business.
- Applying for Loans.
- Trying to Raise Capital.
- Making Sure There are No Hidden Surprises.
Our Los Angeles CPAs have extensive experience preparing, reading, and evaluating business financial statements for small businesses in Los Angeles. Let us work with you to prepare a clear and accurate financial representation of your business.
Small Business Accounting: Financial Statements
This is a high-level overview of the financial accounting statement information we compile and publish for your business needs.
A balance sheet is a snapshot in time of your business financials. It includes assets, liabilities, and net worth. Analyzing how a balance sheet changes over time reveals important financial information about a business, like your ability to collect revenue, manage your inventory, and satisfy creditors and stockholders.
Assets represent the use of funds. Assets include things of value that are owned or due to a business. Your assets can include cash, accounts receivable (A/R), inventory, notes receivable (N/R), prepaid expenses, deposits, long-term notes receivable by third parties, and other miscellaneous items.
Fixed assets represent your investments or things you’ve purchased that have a life span that exceeds more than a year.
Intangible assets are not hard assets like Plant and Machinery, Inventory, Building, Furniture and fixtures. They are not other current assets like Accounts Receivables, Advances paid and Deposits. Intangibles are of definite value to the business, often may not have fixed and determined life. However, they are reported on the balance sheet as separate asset category. Their values are amortized over their estimated useful life. Examples of intangibles are Goodwill, Patents, Customer lists, Covenant Not to Compete etc.
When preparing your financial statement, we include all these items. We analyse your liabilities and net worth, including current and non-current liabilities. We look at your profit and loss or income statement.
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