Annual financial statement is a report that is developed and published by company's management to show company's performance and financial data to the creditors, banks, partners and investors. It is one of the basic tasks of financial bookkeeping as a whole. Seeing this report, investors and creditors can learn everything about company's profitability and assets as well as get acquainted with other relevant information that may indicate company's capability of making investments or taking loans.
Complexity level of annual financial statement
Preparation of financial statement can be straightforward and easy, but at the same time it can be quite challenging for many inexperienced accountants. The complexity level of preparing the financial statement mostly depends on:
For Trading Companies:
Number of transactions throughout the fiscal period;
Number of suppliers and clients of the company;
Complexity and volume of the accounting documents supporting transactions (i.e., agreements, incoming and outgoing invoices, transportation documents, CMRs, export declarations, etc.);
Number of employees;
Volume of fixed assets, loans, interests, taxes and other factors.
For Holding Companies:
Number of subsidiary companies;
Volume of dividends distributed from the subsidiary companies;
Number of employees;
Volume of fixed assets, loans, interests, taxes and other factors.
