How financial statements can help grow your business
Financial statements are the building blocks of any well run company. They can help you to manage and grow your business – if they’re accurate, regularly updated and you use them effectively.
They can reassure investors both current and future and they are essential for getting the best deal on rates if you’re borrowing to invest and grow.
They provide an important comparison with previous years that will enable you to understand the overall trajectory of your business.
They can show how much the business is spending to service its debts and how well positioned it is to repay those debts. It can also show which products or services are most profitable and which are underperforming.
With larger companies, valuation ratios help determine the correct value or price for a company’s shares as well as helping shareholders and others to understand the dividend pay-out ratio and forecast the future dividends.
Specifically, the balance sheet is important because it shows your company’s debt in comparison to its equity.
Article courtesy of sage.com
Original article
