When companies publish their financial accounts, one of the most valuable sources of information about the company’s status is the balance sheet or statement of financial position. The report details the company’s assets, liabilities and equity, and is a snapshot of the company’s financial condition at a particular time. Ratio analysis is often applied to the information on a balance sheet, for example measures of solvency. Published balance sheets are one source of information about a company’s performance, but as they are prepared in arrears, and for particular audiences, they should not be the only source of information. See also Ratio Analysis.
Finance e-Learning courses are available at Academy of Procurement.
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