For financial statements, one will look at the balance sheet. Know how rich the family background of the company you are in and where it is distributed; the second is to look at the profit statement. Know how much money the company has made, whether it is profit or loss, where the money is earned, and where the money is lost; know how much money the company has made in total. The third is to look at the cash flow statement. Know whether the cash on hand of the enterprise has increased or decreased, what channel is the inflow, and what direction is the outflow. There are knowledge, information, and methods in the report. Knowing how to read the "three tables" reflects the professionalism of enterprise managers and is also the basic requirement for them to perform their leadership and management functions.
- "Assets = Liabilities + Shareholders' Equity", this is the most basic logical relationship on the balance sheet, and also the most basic logical relationship in the entire accounting, we call it "accounting identity".
- What information does the balance sheet reveal? It allows the company's shareholders to understand their own family background and the financial status of their company.
Asset Liability Analysis- Pike Data Business Intelligence BI Data Visualization Analysis Platform
3. The balance sheet can only describe the financial condition of the enterprise at the time of tabulation.
This is like, someone has 100 yuan in his pocket, it just means that he has 100 yuan at the moment, not that he has had this 100 yuan in his pocket for the whole past year.
4. The basic logic of the income statement is: the final profit is obtained after deducting all costs from revenue.
5. The income statement actually has two functions, that is, it not only tells the company how much money you are earning now and where you made it from, but also enables the company to understand its future profitability to a certain extent.
Profit analysis- Pieco data business intelligence BI data visualization analysis platform
6. The income statement is a concept of time period.
The income statement shows that the company earned a net profit of 1 million yuan. This does not mean that the company suddenly made 1 million yuan at the moment of tabulation, but that the company has earned a total of 1 million yuan in the past period of time.
7. The four sentences of the income statement:
"Having income does not mean receiving cash"? Because the company has a lot of accounts receivable that have not been recovered;
"Received money but may not have income"? Because I have received the payment in advance from others but have not delivered the goods, the advance payment cannot be regarded as my own;
having expenses does not mean that I have to pay in cash”? Because although the fixed assets are constantly depleted, there is no need to pay others;
“ Paying cash does not necessarily result in expenses”? It’s very simple, because the company prepaid the next year’s rent in exchange for the right to use the house in the next year, and obtained an asset, but did not incur expenses at the moment.
8. Profit is not the same as cash flow.
9. The increase in gross profit cannot be simply regarded as a performance improvement, because the increase in gross profit is not necessarily caused by the improvement in performance, but may also be due to the increase in the inventory of finished products.
This phenomenon will be particularly prominent in asset-heavy industries with high fixed costs.
Performance analysis- Pieco data business intelligence BI data visualization analysis platform
10. If a company experiences a decrease in gross profit and a decrease in product inventory at the same time, the decrease in gross profit is not real either.
Because if last year's inventory is sold, last year's production cost will be converted into this year's operating cost, and this year's gross profit will be less.
11. Although accounting standards stipulate a unique recording method for R&D expenditures, enterprises can achieve different accounting results by designing different organizational structures.
A company with high profits is more willing to record it in expenses, so as to reduce its own tax expenditure;
but for some companies that have difficulties in operating or are still in the entrepreneurial stage, they may be more willing to record it as an expense. In intangible assets, let your financial statements look better.
12. The most direct and superficial connection between the income statement and the balance sheet is that
part of the profit in the income statement may be recorded in the undistributed profit in the balance sheet, and the undistributed profit connects the two tables Together.
13. Among the three cash flows, the cash flow from operating activities is the most stable and reliable.
14. Positive cash flow from operating activities, positive cash flow from investing activities, negative cash flow from financing activities:
This is basically a healthy business because it is operating well, making some gains on its investments, and at the same time, it is Pay back money to the bank or pay dividends to shareholders.
15. Cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities are all positive:
If there is no major investment plan, the company will be sitting on a large amount of "unnecessary spare cash", which is bound to weaken its profitability capacity, its future development may not be smooth.
Asset Analysis- Pike Data Business Intelligence BI Data Visualization Analysis Platform
16. Cash flow from operating activities is positive, cash flow from investment activities is negative, and cash flow from financing activities is positive:
For such companies, investment risk is what they need to pay attention to most. Investment risk not only comes from the choice of investment direction, but also It depends on whether the scale and rhythm of investment can be effectively controlled during the investment process.
17. The cash flow from operating activities is positive, the cash flow from investing activities is negative, and the cash flow from financing activities is negative:
We should not only pay attention to the investment direction, investment scale and rhythm of this type of company, but also pay attention to its operating activities, because this enterprise All cash flow is maintained in its operating activities.
18. Negative cash flow from operating activities, negative cash flow from investing activities, and positive cash flow from financing activities:
Start-up companies are likely to show this cash flow situation, because it is difficult to generate cash flow from operating activities on the one hand On the other hand, it needs continuous investment and relies on financing to survive;
companies in recession may also be in this stage. Although their operating capabilities have declined, they are still investing, raising funds, and looking for new performance growth points.
19. The cash flow from operating activities is negative, the cash flow from investment activities is positive, and the cash flow from financing activities is positive: the cash flow from investment activities
may come from investment income, or from the income from disposal of fixed assets, intangible assets and external investment. If it is the latter, then the future risks of such enterprises are considerable.
20. Negative cash flow from operating activities, positive cash flow from investing activities, and negative cash flow from financing activities:
Such a company must have a very difficult time selling assets and paying off debts at the same time.
21. Negative cash flow for all three:
No business can stay in this state for long.
22. These three reports actually stand on two different dimensions.
In the first dimension, the cash flow statement describes whether a company can survive, which is the so-called risk perspective; in the second
dimension, the balance sheet and income statement show how much the company has and how much income it has, which is the so-called income perspective.
To understand a company, these two dimensions are indispensable.
Disclaimer: The articles published by this official account are originals of this official account, or edited and sorted out excellent articles found on the Internet. The copyright of the article belongs to the original author, and it is only for readers and friends to learn and refer to. For the non-original articles shared, some are unable to find the real source. If the source is wrongly marked or the pictures, links, etc. used in the article include but are not limited to software, materials, etc., if there is any infringement, please contact the background directly to explain the details The article will be deleted as soon as possible in the background. Apologies for the inconvenience caused.