Every business endeavor requires a tangible representation of its actual financial status. A company's financial statements importance is most seen when the business needs to attract potential investors.

 The future of your business should not be left to chance. As a responsible business owner, it is imperative that you take the guesswork and wishful thinking out of the equation and start preparing for specific business situations.

With the rapid digitization of businesses that we saw in the past decade, it is now more common for businesses to do business with entities from other a different country. New technologies and well-devised business and marketing strategies make such transactions convenient and consequently, more frequent.  But equally important in such endeavors, of course, are the cash inflows and outflows involved in these business financial transactions. To explore this further, let us now go into the basics of foreign exchange accounting.

When preparing financial statements, it’s important to note that you are complying with the legal standard set for your business. In the US, a business’ financial reporting and analysis must be compliant to the Generally Accepted Accounting Principles (GAAP) guidelines to make sure they are following the ethical and accurate process.

The volatility in today’s economic and business landscapes has increased the complexity of risks that businesses face. Increasing tariffs, political instability, technological disruptions, and other shifts have transformed the role of the CFO, making them less of a number-cruncher and more of a strategist. In this regard, CFOs should be involved in internal fraud risk management.

Financial statement analysis and valuation serve as a backbone for businesses to know how their finances are going. Are the funds moving in an increasing trajectory? Is it in the red? Will your existing capital help you stay afloat in the coming fiscal year? With the right financial reports on hand, you can confirm your firm’s current performance, compare it with your past year’s standing and even forecast if you can stay in the green during the next quarter.