Almost all Indonesian companies are required to provide audited annual financial statements to the authorities. These statements provide an overview of the financial condition of the company in question, allowing outsiders to know more about the inner workings of the company.

Annual Financial Statement in ID

Definition of Annual Financial Statements

Annual financial statements are financial reports based on a time period that spans 12 consecutive months. The most common time period used when producing annual financial statements is that of the calendar year. However, should a company’s fiscal year not overlap with the financial year, the annual financial statements may also be based on the company’s fiscal year.

Public companies are required to issue statements at certain periods throughout the year as well as reports covering the complete year’s financial activity. These full-year reports are the company’s annual financial statements. The information which is frequently included as part of a company’s annual financial statements include the balance sheet, statement of retained earnings, income statement, and statement of cash flows. Investors and creditors make corporate decisions after processing and analyzing the information which is contained in these reports. Notes from higher management may also be used to supplement annual financial statements.

Necessary Information to Be Contained in an Indonesian Company’s Annual Financial Statements

Some of these most important information contained within the annual financial statement of an Indonesian company exists within its balance sheet. The balance sheet contains all information the company’s assets, liabilities, and equity as of the end of the time period specified within the annual financial statement. The balance sheet serves as a snapshot of the financial position of the company at a particular point in time.

The income statement provides information about the income and expenses of the company during a stated period of time. It is often deemed to provide a more reliable overview of the company’s financial well-being than does the balance sheet.

The cash flows statement reports how the company generated and used all cash acquired during the period specified. This statement classifies all uses of cash into  three distinct categories: operations, investing, and financing.

An Indonesian company’s annual financial statement also ought to include all transactions that affected the equity of the company during the period in question. Examples of the transactions which are usually included are dividends, owner’s investments, and mergers. All transactions typically include explanatory notes alongside them.

All of this information is to be used by the management of the company. The management will then analyze and discuss the annual financial statement. However, final decisions made by the management are usually not made until some time after the first viewing of the annual financial statement itself.

Annual financial statements contain large amounts of information related to the financial well-being of a company. Certainly, if you own a company, you would want it to be in peak financial condition. This is where we at Paul Hype Page & Co come in. We will help you ensure that your company remains in good financial condition at all times. We do this through the provision of our financial planning services which have aided many a company owner, including those in Indonesia as well as those in other countries.