18.07.2022 - 10:15

Describe in detail the difference of the roles between treasurer and controller.

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Describe in detail the difference of the roles between treasurer and controller.

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  • Sondra
    April 13, 2023 в 04:02
    The balance sheet, income statement, and statement of cash flows are three critical financial statements used by companies to understand their financial position, profitability, and liquidity. The balance sheet provides a snapshot of a company's financial position at a specific point in time, including its assets, liabilities, and equity. This statement helps in determining an organization's liquidity and solvency and provides a clear overview of what the organization owns and what it owes. The income statement shows a company's financial performance over a period, typically a fiscal year or quarter. The statement helps in understanding the profitability of the organization by showing revenues, expenses, and net income. This statement helps investors and stakeholders in understanding the organization's profitability, making critical financial decisions. The statement of cash flows is a summary of the money that flows in and out of an organization over a period, highlighting its operating, investing, and financing activities. The statement helps in understanding the company's cash position and its ability to finance its operations or make investments or repay debts. The three statements are interconnected, and changes in one affect the others. The income statement's net income is reflected in the balance sheet's equity section, and the statement of cash flows shows the inflows and outflows from operating activities (part of the income statement), investing activities (evident in the balance sheet), and financing activities ( loans and debt incurred). The statement of cash flows is divided into three sections, including operating activities, investing activities, and financing activities. The operating activities section is primarily derived from the income statement and shows the cash transactions associated with day-to-day business operations. The investing activities section shows an organization's investment activities and the purchase or sale of long-term assets such as a property or equipment. The financing activities section displays the cash inflows and outflows related to long-term finance, such as loans or debts. In summary, the balance sheet, income statement, and statement of cash flows provide different yet equally essential information about a company's financial position, performance, and liquidity over a period. The three statements are interrelated, and the changes in one statement have consequential effects on the others. These statements are critical tools for investors and stakeholders to make informed decisions about an organization.
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