Controlling the flow of fundsthrough a business is an important management activity. An analyst may judge the overall quality of management by interpreting the clues about how successfully the management team brings funds into the company and how successfully management allocates those funds once raised. There are several financial statements that may assist the analyst in gathering clues about funds flow. Funds Type Statements are statements showing how funds flow through a business. Some examples include: Statements showing the flow of funds throughout a business may provide clues about the quality of management. In the Funds Statement example below, the cash account goes from $20,000 on the first, Beginning Balance Sheet to $5,000 on the second, Ending Balance Sheet. That is a decrease of $15,000. A decrease in an asset item is asource of funds. Other changes would be classified accordingly. When analyzing the information that goes into a funds statement, each item should be analyzed in detail and the overall impact of any change should be examined. In the funds statement example below, the company appears to be profitable because retained earnings increased. Also, the company paid off a great deal of debt and purchased some fixed assets. To finance these moves, the company relied on reductions in inventory, receivables, and cash, as well as plowed earnings back into the firm. This overview was developed by Dr. Sharon Garrison. Fund statements, also known as financial statements, are a compilation of a company's assets, liabilities, and owners' equity at a specific point in time. The purpose of fund statements is to provide insight into a company's overall financial position and performance over a period of time. There are three primary types of financial statements: the balance sheet, income statement, and cash flow statement. The balance sheet shows a company's assets, liabilities, and owners' equity at a specific point in time. The income statement shows a company's revenue and expenses over a period of time, while the cash flow statement provides information on how cash moves in and out of a company. A source of funds statement is a financial statement that shows the sources of a company's cash flow. It identifies the various items that contributed to a company's increase or decrease in cash, as well as how those changes impacted the company's overall financial position. The 5 financial statements are the balance sheet, income statement, cash flow statement, statement of changes in owners' equity, and statement of cash flows. These statements provide a comprehensive view of a company's financial health and performance over time. A funds statement can provide a company with a detailed overview of its financial position and performance. It can help identify areas where the company is generating cash, as well as areas where it is spending more cash than it is taking in. This information can be used to make informed decisions about how to best manage and grow the business.Funds Type Statements
Examples of Funds Statements
Funds Flow
Sample Statements
Statement of Changes in Financial Position
Cash Flow Statement
Funds Statement
Constructing a Funds Statement
Constructing a Funds Statement
Sources and Uses of Funds
Sources of Funds
Uses of Funds
Classifying Changes
Example of Classifying Changes
Funds Statement – Step 1
Analyzing Information
Funds Statement – Step 2
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1. What are fund statements/financial statements?
2. What are the types of financial statements?
3. What is a source of funds statement?
4. What are the 5 financial statements?
5. What are the benefits of a funds statement?
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