Personal Financial Statement

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A Personal Financial Statement is a fairly standard financial form. There are a variety of different kinds of financial statements, most of them designed for corporate or other business entities. This is primarily to keep track of their cash flow and income, usually for either tax purposes or to prove income for a loan.

What is a Personal Financial Statement?

A Financial Statement is, on the most basic level, a record of the entities financial activities. These are most commonly used to keep track of a business or corporations, usually for tax purposes or other record keeping. A Personal Financial Statement, as the name suggests, only applies to the finances of one person or family, and can often be more simple and concise than a corporate form. All of the information included in this page can apply to both a Corporate and a Personal Financial Statement, though many of them will apply more often to a Corporate one, and are included for the sake of completeness.

A Financial Statement consists of three main parts. The first is the Statement of Financial Position, more commonly known as a Balance Sheet. This sheet shows the company or person’s current financial situation; How much money they currently have, what other financial assets they have or have access to, their equities, as well as any debts or other liabilities they have.

The second part a Financial Statement is known by a variety of names, the most common being Profit and Loss Report or Income Statement. While a Balance Sheet reports on the company or person’s income at the time the Balance Sheet was made, an Income Statement reports on the person or corporation’s income over a period of time. In a Personal Financial Statement, this mostly consists of the person’s wages over a period of months, as well as what they pay regularly for vital bills, such as rent, utilities and credit card payments.

The final part of any Financial Statement is the Cash Flow Statement. This indicates the person or company’s incoming and outgoing incomes unrelated to the first two elements, such as money from investments or financing. This is rarely included in a Personal Financial Statement.

How is a Personal Financial Statement used?

A Personal Financial statement is most commonly drafted when the person about who it concerns is applying for a loan or other financial aid. While it can, depending on the loan or aid being applied for, include all of the above sections, it can also be as simple as a single page form. These forms are almost always filled out by the organization that would grant the aid or loan, based on information provided by the person who it pertains to.