In depth steps to prepare financial statement of a sole proprietor | Right from collecting data till analyzing it

The accounting cycle is the name given to the collective process of recording and processing the accounting events of a company. The series of steps begin when a transaction occurs and end with its inclusion in the financial statements.

Financial statements (or financial report) is a formal record of the financial activities and position of a business, person, or other entity. It mainly consist of Trading account, Profit & Loss account and the balance sheet.

It is standard practice for businesses to present financial statements that adhere to generally accepted accounting principles (GAAP) to maintain continuity of information and presentation across international borders.So it is very important for companies to prepare financial statement which gives true and fair view of the business.