First-hand information to be able to establish objectives , plan and control the economic-financial performance of the company. Make decisions aimed at improving the management of resources in order to achieve better results, profitability and, ultimately, greater financial strength . balance sheet A part that clearly shows us the economic and financial situation of a company at a given time is the balance sheet , also called the statement of financial position.
It is an accounting financial report that shows information on how the company's economy is at the end of a year, therefore, it is like a photograph taken at a specific C Level Executive List time that helps us understand if the company is doing well or badly. This balance is divided between assets and liabilities . The assets let us know the goods and rights that have been registered in favor of the company. Meanwhile, the liabilities show us the obligations that the company has contracted up to that moment (as well as the debts).
As part of the financial economic analysis, the balance sheet will reveal the company's position in the market in general, as well as the company's ability to meet its payment obligations in the short and long term . For example, if payment capacity is good in the short term but not in the long term, the company must find financing formulas to increase said capacity in the long term. Economic and financial ratios The best instruments to quickly know the situation of the company are the financial ratios.