The preparation of the Financial Statements is done from Trial Balance. They are responsible for depicting the true financial position of the business and they may provide valuable financial information to the users.
Trading and Profit and Loss A/c or Income Statement
This shows the financial performance by determining the profit or loss made by a business during an accounting year.
This showcases the financial position of the business by telling about the assets, liabilities and the capital as of a particular date.
Cash Flow Statement
This is responsible for showcasing the inflow and outflow of the cash during a particular accounting period.
Financial Statements provide valuable information to stakeholders and aid them in making informed decisions.