A profit & Loss Statement is also called an income statement. It shows a business's revenue, costs, and expenses over a period of time. For a business owner like you, it highlights where your business is succeeding and where it may be struggling.

A Balance sheet, also known as a statement of the financial position, provides a snapshot of your business's financial condition at a single point in time. It summarises all your business assets (what your business owns) and liabilities (what your business owes). At any point in time, it shows you how much money you would have leftover if you sold all your assets and paid off all your debts. This is also known as 'owner's equity.

A cash flow statement is also known as a statement of cash flows. It depicts the amount of money flowing in and out of your business over a period of time. This indicates the 'liquidity' of your business. Having enough cash available to pay your debts and buy materials and assets is an important part of business planning. A cash flow statement will instantly tell you if you're going to run into any problems in this area. It only records cash transactions, i.e., non-cash transactions are not recorded.