Meaning of Financial Statements

Financial Statements are the Statements which provide financial position of a business firm. These are prepared for the purpose of presenting a periodic review or report on the progress made by the business firm. They deals with the investments made in a business and the results achieved during a fixed period of time.

The term ?Financial Statements? basically includes two statements :-

Income Statement

Income Statement is a ?Profit and Loss Account?. It provides information about the profitability position of the business firm. 

Position Statement

Position Statement is the ?Balance Sheet?. It provide information about the financial position of the business firm.