Audited financial statements are those, which are worked out and verified by a certified professional.
The audited financial statements are authenticated by the CPAs or the Certified Public Accountants. Any financial statement is required to be made in accordance with the GAAP or Generally Accepted Accounting Principles. In the United States of America, the financial statements are audited by the CPAs.
Types of Audit Opinions:
Audited financial statements can have two results:
Qualified Opinion: The auditor gives a qualified opinion, if he feels that there are certain aspects in the financial statement, needing alterations and verifications. The auditor is of the opinion that the financial statement has not been prepared as per norms(GAAP).
Unqualified Opinion: An auditor gives an unqualified opinion if he feels that the company has followed all the guidelines. An unqualified opinion is given only if the auditor gives consent to the company’s mode of operations.
Majority of the financial statements are audited by a certified public accountant. There might be times when the financial statements do not follow the basic principles of accounting principles.
Types of Audited Financial Statements:
Similar to the other financial statements, audited financial statements are of 3 types:
Balance Sheet: The balance sheet of a company offers information about revenues, assets and liabilities of a company. It gives an insight in to the financial state of a company at a given period. Balance sheet of a company conveys details of money, the company is to receive from the market, current position of financial status, amount of cash available. This statement also conveys the account payables, the amount of money, the company has to pay to others.
Income Statements: Income statements of an audited financial statements, contains information about the loss as well as profits of a particular company. The income statement is also known as P&L income statement or Profit And Loss Income Statement.
Cash Flow Statements: Indicates or keeps track of the movement of money in and out of the company.
Last Updated on : 26th June 2013