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A personal financial statement is used by small businesses in order to obtain a loan from a bank or financial institution. Individuals who are organized and financially forward thinking also find use in creating and maintaining a personal financial statement. In the case of a business, if the business is new and has no establish credit history or collateral the bank will typically require a financial statement in order to judge the credit worthiness of the company; the statement outlines the debts and assets of the individual guarantors.
The first step in creating a personal financial statement is to create a header of the top of the page. The header will include the company contact information. This information should include the name, address and contact phone numbers for the principle guarantor. Even though the personal financial statement will accompany the loan application, the contact information will need to be included on the personal statement as well as on the application for financing.
Secondly, an asset and liability column needs to be created. Each asset should be recorded on its own line and be rounded to the nearest dollar. Assets will include any monies in checking and savings accounts as well as any life Insurance, real estate and any other assets that are owned by the business or the guarantors. The liabilities will be listed in the same way and will list outstanding debt including credit card obligations, mortgage, taxes and loans.
There should also be a section on the personal income statement that details income. Personal income can include a salary from employment, investments and additional income such as divorce support income or retirement. The key is to show the lending institution that there are is a stable and reliable source of income which can be used to repay the loan or financing that is being applied for.
A thorough personal financial statement will also include a list of all contingent liabilities. Contingent liabilities are all the other financial obligations and will include loans that have been cosigned for or any judgments that may be claimed against the applicant. The lending institution not only wants to see the applicant's current financial standing, but would also like to get a preview of any other outstanding debt that could affect repayment.
A proven lender will conduct an evaluation of assets and liabilities when determining credit worthiness. It is important that the personal financial statement shows the maximum amount of assets owed. The liabilities should not outweigh the assets or the applicant's financial picture will not be as favorable and obtaining financing will be difficult.
What else can I help you with?
What is a personal financial statement form?
A personal financial statement form is a document that helps you to calculate your personal net worth. It takes into account all of your assets and liabilities and calculates whether your net worth is positive or negative.
What is a personal financial statement form for?
A personal financial form is a formal record of all the financial activities completed by that entity, whether a business, or an individual. Reported assets, liabilities, equity, income and expenses are directly related to an entity's financial position, and a financial statement should present this clearly.
What is a personal financial statement?
A personal financial statement form is a document that helps you to calculate your personal net worth. It takes into account all of your assets and liabilities and calculates whether your net worth is positive or negative.
Is a Form 1065 like a financial statement?
No
What is considred to be a personal finance statement?
A financial statement (or financial report) is a formal record of the financial activities of a business, person, or other entity. In British English-including United Kingdom company law-a financial statement is often referred to as an account, although the term financial statement is also used, particularly by accountants. For a business enterprise, all the relevant financial information, presented in a structured manner and in a form easy to understand, are called the financial statements. They typically include four basic financial statements, accompanied by a management discussion and analysis.
Which form is considered the financial source document?
statement of charges
Probably not be requested when filling out a form?
personal statement
What items might be in the financial statements but not actually on the balance sheet income statement statement of retained earnings or statement of cash flows?
Since the notes to the financial statements form part of the financial statements and are a component of financial statements, certain disclosures found in the notes may not be found in the balance sheet, income statement, statement of retained earnings or statement of cash flows.
Explain the principle of substance over form and how it limits the financial statement?
Substance over form is an accounting principle used to ensure that the financial statement reflects the complete, relevant and accurate picture of the transactions and events.
Where is a printable financial statement form available from?
There are many sites that a person may find a printable and/or downloable financial statement. For instance, the websites Financial Guides, Docum Base, and Word Explorer offer printable financial statements.
Is a financial statement form required for tax purposes?
A financial statement is always required for a business large or small. The IRS needs this evidence of activity within a business for tax deductions.
Why an auditor should not prepare the financial statement and then express an opinion Also the standards to which this relates?
The auditor is the person who assesses whether the financial statement has been prepared accordingly or not. Firstly it is not the role of the auditor to prepare the financial statement as the auditor has to form an independent opinion. Secondly, it would be part of internal control and corporate governance activities for the preparation of the financial statement and the audit to be conducted be two separate parties to eliminate error or fraud.
