Ti trovi in:
Annual accounts
Annual Accounts constitute the documentation that a company is required to periodically draw up in accordance with the law. It aims to implement the principle of truthfulness and provide a clear and proper picture of the equity/financial situation of a company, as well as its economic results, at the end of the relevant financial period.
Annual Accounts are made up of three parts:
- Balance Sheet;
- Income Statement;
- Additional Note.
Balance Sheet
A Balance Sheet shows a company’s situation at the end of the financial year. In this document, the financial position of the company must be described, as well as its equity, assets, liabilities, and the mismatch between the latter. It is divided into two sections: assets and liabilities.
Assets – All assets (such as buildings, machinery, equipment) used for carrying out the company’s business activity, receivables from third parties (customers, etc.), liquidity (cash, budget surplus).
Liabilities – Payables to third parties (suppliers, banks, etc.). Net capital constitutes the company's debt to its owners and consists of budget reserves and share capital.
Income Statement
An income statement provides information on the economic situation of a company, indicating costs incurred and revenues earned by the company during the financial year. For each year, profits or losses are derived from the mismatch between costs and revenues.
Additional Note
An additional note constitutes an integral part of annual accounts. This document contains all the information showing a truthful and correct representation of the economic, patrimonial, and equity position of a company. As an example, it might consist of a report on the accounting policies adopted, a detailed explanation of the reasons for the inclusion of certain items in a balance sheet (or income statement), and other useful information.
