The functions of the predictive financial report include: helping information users make decisions; Reduce the capital cost of enterprises; Promote enterprise operation, maintain enterprise image, and improve enterprise management level.
Predictive financial report refers to a written report prepared and disclosed by an enterprise in accordance with appropriate principles, existing financial conditions and business performance already achieved, taking into account the determinable and uncertain factors that may occur in the future, and adopting scientific forecasting methods, which reflects the financial situation of the enterprise at a certain point in the future and the changes in business performance and financial status within a certain period, It is also an important basis for financial information users to make decisions and judgments. For enterprises, the disclosure of predictive financial reports plays an important role. When preparing predictive financial reports, the basic variables and assumptions should be determined first.
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What are the main functions of financial reports
Functions of financial statements:
First, through the analysis of the balance sheet, we can understand the company's financial situation and make judgments on the company's solvency, whether the capital structure is reasonable, and the adequacy of working capital.
Second, through the analysis of the income statement, we can understand and analyze the company's profitability, profitability, operating efficiency, and make judgments on the company's competitive position in the industry and sustainable development ability.
Third, by analyzing the cash flow statement, we can understand and evaluate the company's ability to obtain cash and cash equivalents, and predict the company's future cash flow.
Methods and principles of financial statement analysis
The methods of financial statement analysis mainly include financial ratio analysis of a single year, comparative analysis of different periods, and comparative analysis with other companies in the same industry.
1. Financial ratio analysis refers to the comparison between various items of the Company's financial statements within a financial year, calculation of ratios, and judgment of solvency, capital structure, operating efficiency, profitability, etc. within the year.
2. Comparative analysis of the Company's financial statements in different periods can analyze the Company's ability to continue as a going concern, the trend of changes in financial conditions, and profitability, and dynamically analyze the Company's situation from a longer period of time.
3. Comparative analysis with other companies in the same industry can understand the advantages and disadvantages of various indicators of the company and judge individuals in the group.
What are the functions of financial statements?
1. The financial accounting report is the basis for the country to carry out economic macro-control.
Through the level by level summary of the accounting statements, it is convenient for the country to grasp the development speed of the national economy, and it is an important information source for the national economic management department to formulate macroeconomic management policies and economic decisions.
2. Provide information to competent authorities, investors, creditors and other external units and departments.
Through the financial accounting report, the superior competent department can understand the business performance of the enterprise, fully understand the financial situation and operating results of the enterprise, guide and help the enterprise to develop on the right track, help investors, creditors and potential investors to compare and analyze the business performance and financial strength of different enterprises, and determine their investment and loan direction, Reducing investment risks is conducive to maintaining the healthy and stable development of the national economy.
3. Provide necessary information for the internal management staff of the unit.
Through the financial accounting report, the operation and management personnel can master the whole situation of their own economic activities, financial revenues and expenditures and financial achievements, analyze their own advantages in business activities, find out the reasons for the problems, and constantly improve the operation and management, so as to correctly carry out the management and financial decisions and improve economic efficiency.
The staff and workers' congress of each unit can also better participate in the operation and management activities of the unit through the data provided in the accounting statements.
4. Promote the rational allocation of social resources.
By preparing and providing useful financial accounting reports, users of financial accounting reports can use financial information and other information sources to promote the effective action of capital markets and other markets, and promote the reasonable distribution of limited social resources.
Corporate goals
The goal of an enterprise is to provide useful accounting information for decision-making. In accounting, an accounting entity can comprehensively, continuously and systematically reflect economic transactions and their results by setting and registering accounting books.
However, because the accounting book data is scattered in each accounting account, it can not clearly reflect the internal relationship between various economic indicators, can not meet the national macroeconomic management requirements, can not meet the needs of investors, creditors and other accounting information users to understand the financial situation and operating results of the company, and can not meet the needs of strengthening operation and management within the company.
Therefore, financial personnel should provide comprehensive accounting information reflecting the financial status, operating results and cash flows of the accounting entity by preparing financial accounting reports.