tutorials

• statement of changes in equity vs equity section in balance sheet

  • period: statement reports for a period, the balance sheet shows a specific point in time
  • content: statement includes more specific details, balance sheet provides broader
• Explain how the four main financial statements link together. 

  • net profit/loss from Income Statement contributes to equity section on both the Statement of Changes in Equity and Balance Sheet.
  • Changes in equity on the Statement of Changes in Equity are reflected in the equity section of the Balance Sheet.
  • The cash flow from operating activities on the Cash Flow Statement reconciles with the net income on the Income Statement.
  • Financing activities on the Cash Flow Statement connect with the equity and debt transactions reported on the Balance Sheet and the Statement of Changes in Equity.