The balance sheet provides an overview of your company's financial position at a specific point in time and reflects the outcome of consecutive changes in assets and liabilities resulting from business activities.
The profit and loss statement shows whether your business is making a profit or incurring a loss. It provides an overview of your company's revenue and expenses for that year.
The larger your company, the more financial information you will need to disclose. Small businesses in the explanatory notes only need to mention the number of employees and the method used to prepare the balance sheet. For larger legal entities, the explanatory notes may also need to include details such as payments to the board of directors, for example.
For larger enterprises, the financial statement is often a part of the annual report, which looks back on the business activities of the past year. Sole proprietorships and partnerships (vof's) are not required to create an annual report.
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