Changes

A '''financial statement''' (or '''financial report''') is a record of the financial activities of a business or other entity.

A '''financial statement''' (or '''financial report''') is a record of the financial activities of a business or other entity.

In the private sector (including non-profit/not-for-profit entities) there are four basic financial statements:  the '''balance sheet'''<ref>[http://www.accountingcoach.com/terms/B/balance-sheet.html Balance sheet definition]</ref>, the '''income statement'''<ref>[http://www.accountingcoach.com/blog/what-is-the-income-statement.html Income statement definition]</ref>, the '''statement of equity'''<ref>[https://www.accountingcoach.com/terms/S/statement-of-retained-earnings Statement of retained earnings definition]</ref>, and the '''statement of cash flows''' (in some entities different terms may be used).  Of the four, only the balance sheet represents activities '''''at a single point in time''''' (usually as of the end of the entity's [[fiscal year]]) whereas the other statements represent activities '''''during a period of time''''' (usually an entire fiscal year).

In the private sector (including non-profit/not-for-profit entities) there are four basic financial statements:  the '''balance sheet'''<ref>[http://www.accountingcoach.com/terms/B/balance-sheet.html Balance sheet definition]</ref>, the '''income statement'''<ref>[http://www.accountingcoach.com/blog/what-is-the-income-statement.html Income statement definition]</ref>, the '''statement of retained earnings'''<ref>[https://www.accountingcoach.com/terms/S/statement-of-retained-earnings Statement of retained earnings definition]</ref>, and the '''statement of cash flows''' (in some entities different terms may be used).  Of the four, only the balance sheet represents activities '''''at a single point in time''''' (usually as of the end of the entity's [[fiscal year]]) whereas the other statements represent activities '''''during a period of time''''' (usually an entire fiscal year).

The statements (including the format) may be specified by law or regulation.  Larger companies will also include extensive footnotes (some of which are required by law or regulation) as well as a management discussion and analysis of their contents.

The statements (including the format) may be specified by law or regulation.  Larger companies will also include extensive footnotes (some of which are required by law or regulation) as well as a management discussion and analysis of their contents.

The irregular section includes items which are not expected to recur.  These items are reported '''''net of taxes'''''.  The most common item in this category is '''discontinued operations'''.  A discontinued operation is one where the company either has stopped doing business, or has announced plans to do so.  This can mean either a line of business (e.g. a company that customizes and maintains aircraft decides to get out of maintaining aircraft) or a geographical area (e.g. a grocery chain decides to exit the Dallas-Fort Worth market, but continue operations in other parts of the country).

The irregular section includes items which are not expected to recur.  These items are reported '''''net of taxes'''''.  The most common item in this category is '''discontinued operations'''.  A discontinued operation is one where the company either has stopped doing business, or has announced plans to do so.  This can mean either a line of business (e.g. a company that customizes and maintains aircraft decides to get out of maintaining aircraft) or a geographical area (e.g. a grocery chain decides to exit the Dallas-Fort Worth market, but continue operations in other parts of the country).

==Statement of Equity==

==Statement of Retained Earnings==

The '''statement of equity''', also commonly called a '''statement of retained earnings''', shows the changes in an entity's equity during a period in time.

The '''statement of retained earnings''', also called a '''statement of equity''', shows the changes in an entity's equity during a period in time.

Primarily, it takes information from the income statement and provides information to the balance sheet.

Primarily, it takes information from the income statement and provides information to the balance sheet.