Comparative Statement

Financial statements covering different dates but prepared consistently and therefore lending themselves to comparative analysis, as accounting convention requires. Comparative figures reveal trends in a company's financial development and permit insight into the dynamics behind static balance sheet figures.

Statement on which balance sheets, income statements, or statements of changes in financial position are assembled side by side for review purposes. Changes that have occurred in individual categories from year to year and over the years are easily noted. The key factor revealed is the trend in an account or financial statement category over time. A comparison of financial statements over two to three years can be undertaken by computing the year-to-year change in absolute dollars and in terms of percentage change. Longer-term comparisons are best undertaken by means of Index-Number Trend Series.