Income Statement, Balance Sheet and Cash Flow

The three core financial statements every business relies on are the income statement, balance sheet, and cash flow statement. The income statement tracks revenue and expenses over a specific period to show whether a company made a profit or loss. The balance sheet provides a snapshot of what a company owns (assets), what it owes (liabilities), and what belongs to shareholders (equity) at a single point in time. The cash flow statement tracks actual money coming in and going out, broken down into operating, investing, and financing activities — because profit on paper does not always mean cash in the bank.