Elements of the report on financial results, their characteristics
The statement of financial performance characterizes the organization’s performance for the reporting period and shows how it makes profit or loss. Four elements can be distinguished in the statement of financial performance: income, expenses, profits and losses. Revenues represent an increase, and expenses, a decrease in the economic benefits of an economic entity that result from the receipt or disposal of assets, as well as repayment or incurrence of obligations to the budget, extra-budgetary funds and third parties, leading to certain changes in the capital of this entity. Profit most fully reflects production efficiency, the volume and quality of manufactured products, the state of labor productivity, and the level of cost. Loss is the excess of expenses over income, it is a circumstance that reduces the amount of equity.