Consolidating financial statements - you might have heard this once or twice in the past. Whether your company is part of a larger network of subsidiaries or it is in itself the parent company of a diverse group of companies, the need to consolidate your financial statements may come up at one point or another. Consolidated financial statements, as the name suggests, is a summative accounting figure of a parent company and its subsidiaries.

A recent article published by Small Business Trends shows that the business exit rates in the US are declining. According to the report, the latest data collected by the Census Bureau in 2013 suggests that the SME exit rates in the country are down at 9%, clearly depicting a significant improvement on the performance of contemporary SMEs in America.

As a business owner, you cannot manage your business operations well without a basic understanding of financial accounting. Likewise, you also need to be well-versed about financial statements. A financial statement is a formal record of your financial activities, it is a document from your financial service provider which clearly states your assets, liabilities, revenues and the overall financial position of your company. Indeed, financial statements are very important. But if you are still unconvinced, here are more ways to make better sense of the role of a financial statement in relation to your business:

The tedious process of organising your books is already taxing in itself. But beyond keeping your books in order, you also need to know how to put your financial statements together and later on, learn how to analyse them as well. If truth be told, there are many different ways to analyse your financial statements. Your chosen method will depend on what specific financial information you want to look into. To get you ahead in financial statement analysis, you might want to take a look at the common methods used by accountants and business advisers: