Answer
Financial statements are the main methods through which financial information is conveyed to interested parties inside or outside the organization. There are four major financial statements which include: the balance sheet, income statement, statement of stakeholders equity, and the statement of cash flows. However, some financial information is better given, or can only be provided by, the approach of financial reporting. Financial reporting (other than financial statements and related notes) may take different structures. Illustrations of such include the organization president's letter or supplementary schedules in the yearly corporate reports, plans, news releases, management forecasts, reports filed with government offices, and enterprises' environmental/social impact.
Work Step by Step
While reporting is used to provide information for decision making, financial statements are the tools for financial reporting.
