Analysis of the statement of financial position referred to as a balance sheet analysis, reports on a company’s assets, liabilities, and ownership equity at a given point in time.
1. A financial statement analysis provides information on the
operation of the
enterprise.
These include sale and the
various expenses incurred during the
processing state.
2. Financial statement analysis gives information about the changes in equity which helps to explain the changes of the company’s equity throughout the reporting period.
3. Financial statement analysis provides information about cash flows which helps to prepare report on company’s cash flow activities, particularly its operating, investing and financial activities.