What is financial statement preparation?

Financial statement preparation is a key component of business formation law in Washington. It involves creating reports that summarize the financial status of a business. Generally speaking, there are three main financial statements that are created for a business: the balance sheet, the income statement, and the cash flow statement. The balance sheet lists a company’s assets and liabilities; the income statement records sales and expenses; and the cash flow statement measures cash inflow and outflow. Financial statement preparation also involves providing evidence of sufficient funds to start a business. This includes demonstrating that the company has enough money to cover the cost of things such as licenses and permits, equipment, wages, and other expenses. The creation of financial statements should be done by a professional accountant to ensure accuracy. Additionally, the Washington Department of Revenue may require that certain financial statements be filed as part of the registration process of a new business. As part of the business formation process, it is important to accurately prepare financial statements in order to properly track the financial flow of a business. Doing so will provide better insight into business performance, as well as help identify potential issues that need to be addressed.

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What is financial statement preparation?

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