Financial reporting assists statement users in forecasting future cash flows by providing an income statement format that segregates components of net income.

Financial Reporting

Financial reporting involves the disclosure of financial results and related information to management and external stakeholders, such as investors or regulators.

Future Cash Flows

The projected cash receipts and payments a business expects over a period in the future, important for investment and valuation purposes.

Net Income

Profit of a company after all expenses and taxes have been subtracted from total revenue.