Financial reporting is the process of collecting, analyzing, and presenting financial information to stakeholders, including investors, creditors, and regulatory bodies. It involves the preparation of financial statements, such as balance sheets, income statements, and cash flow statements, which provide a snapshot of a company’s financial performance over a specific period of time. Financial reporting is essential for decision-making, as it enables stakeholders to evaluate a company’s financial health, profitability, and liquidity. It also helps to ensure transparency and accountability, as companies are required to comply with various accounting standards and regulations. Effective financial reporting requires accurate and timely data, as well as a thorough understanding of accounting principles and practices. It is a critical function for any organization, as it provides the foundation for strategic planning, risk management, and compliance.
