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Trial balance, Balance Sheet and Income Statement/P&L constitute a Financial Statement. A Financial Statement provides information about the financial position, performance and changes in financial position of an enterprise, by presenting a company`s reported assets, liabilities, equity, income and expenses in a comprehensive and structured way.

Financial statements are an important part of a business operation. They let business owners know where they stand currently in areas such as assets, liabilities, income and cash flow, as well as how well they’ve done during a just-completed fiscal year. They also play a part in the planning process of a business, especially for one preparing to launch.

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