 Why Financial Planning?

Business financial planning affects how and on what terms you will be able to attract the
funding required to establish, maintain, and expand your business. Financial planning
determines the raw materials you can afford to buy, the products you will be able to
produce, and whether or not you will be able to market them efficiently. It affects the
human and physical resources you will be able to acquire to operate your business. It will
be a major determinant of whether or not you will be able to make your hard work
profitable.

 income statement (also referred as profit and loss statement (P&L), statement of financial

performance, earnings statement, operating statement orstatement of operations)[1] is a
company's financial statement that indicates how the revenue (money received from the sale of
products and services before expenses are taken out, also known as the "top line") is
transformed into the net income (the result after all revenues and expenses have been accounted
for, also known as the "bottom line")

 Word "reconciliation" suggests, this section starts with an opening balance which is the
carryover from the previous month's operations. The current month's Revenues are added to
this balance; the current month's Disbursements are subtracted, and the adjusted cash flow
balance is carried over to the next month.
 Assets are tangible objects of financial value that are owned by the company.
 A liability is a debt owed to a creditor of the company.
 Equity is the net difference when the total liabilities are subtracted from the total assets.