What does a financial statement typically include?

A financial statement typically includes a balance sheet, income statement, and cash flow statement because these three components provide a comprehensive overview of a company's financial performance and position.

The balance sheet presents a snapshot of a company's assets, liabilities, and equity at a specific point in time, allowing stakeholders to assess the company's financial health. The income statement, also known as the profit and loss statement, shows the company’s revenues and expenses over a specified period, thereby illustrating its profitability. The cash flow statement details the inflow and outflow of cash within the business, highlighting how well the company manages its cash resources.

Together, these three financial statements offer crucial insights for investors, creditors, management, and other users by providing a cohesive picture of the company's financial status, operational efficiency, and liquidity. This makes them essential for both internal decision-making and external reporting.