What Are the Three Types of Financial Statements?

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Thinking about starting your own small business, but you’re intimidated by the thought of managing all your records and handling your own accounting? The good news is you don't have to be a genius or a financial wizard to understand and prepare basic financial statements for your company. It’s not difficult to learn the basic elements of business accounting that go into preparing these documents, and knowing how they work will serve you well as you manage your company’s finances and make important business decisions.

The three financial statements that are most important to small businesses are balance sheets, income statements and cash flow statements. Here’s what you need to know about each one of them to ensure your business’ financial records are always accurate and current.