Order of Financial Statements
Why Are Financial Statements Prepared In A Specific Order? The Order of Financial Statements is very important as one information gathered from one Financial Statement is forward to the next Statements, so there is a systematic way or logical sequence to arrange the order of Financial Statements Step by Step. After preparing the Main books of Accounts , the next step is to prepare Trial Balance . Then Adjusted Trial Balance is prepared in order to make Adjustments for Accrual and Deferrals . After that, four main Financial Statements are prepared. Order or Seque nce Of Financial Statements First Financial Statement that is prepared after adjusted trial balance is Income Statement or Statement of Comprehensive Income . It is also called Trading & Profit And Loss Account under B ritish Accounting System. The purpose of this statement is to show Financial Performance ( Net Income ) of the business for the accounting period. ...