Financial reporting

Producing statements and disclosures about a company's performance, position and cash flows for outside users, within the rules of an accounting standard and the choices it leaves to management.

Where you will meet it

Financial reporting appears in 3 learning outcomes on the CFA syllabus. A few of them:

• Explain the purpose of financial reporting and of analysing financial statements
  CFA Level I · Financial Statement Analysis

  “Financial reporting produces information about a company's performance, position and cash flows for parties outside it.”

• Set out the different definitions of value and argue which one fits the valuation of a listed company best
  CFA Level II · Equities

  “Fair value in financial reporting is an exit price in an orderly transaction between market participants.”

• Set out why private businesses are valued and what financial analysts should concentrate on
  CFA Level II · Equities

  “Compliance-related valuations meet financial reporting requirements, such as goodwill impairment tests, and tax requirements, such as estate and gift tax.”

Practise it

• Today's practice question One question, with every wrong option explained.
• Free Level I diagnostic test Twelve questions that show which topics to start with.
• Free finance calculators Check your arithmetic on the exam's core formulas.

All terms beginning with F · Glossary