Chapter 1

Introduction
1. What is financial statement?
Financial statements are reports prepared by a company's management to present the
financial performance and position at a point in time.
Financial statements (or financial reports) are formal records of the financial activities
and position of a business, person, or other entity.
Financial statements include:
 Balance sheet.
 Income statement.
 Cash flow statement.
 Statement of Changes in Equity.
2. State the features of financial statement.

3. Describe the forms of financial statement.

4. Who are the users of financial statements?
5. What is business analysis?
6. What are the sources of information for business analysis?
7. What are the sources of information for financial statement analysis?
8. Describe the types of business analysis?
9. What is financial statement analysis?
10. State the objectives of financial statement analysis.
11. What are the six steps to developing an effective analysis of financial statement?
12. Describe the needs or importance of financial statement under various parties.
13. What are the limitations of financial statement analysis?