Financial statements are official records of a firm, organization, or person's financial performance. They give a general picture of the financial situation, operational outcomes, and cash flows for a given time frame.

Here are some key terms of Financial statements:

1. Balance Sheet: A company's financial situation at a certain period is depicted in ter balance sheet (statement of financial position). It lists the company's assets, liabilities,and equity held by shareholders.

2. Income Statement: This statement, often known as profit and loss statement, lists a company's revenues, costs, gains, losses for a given time period. By determining net income or net loss, it demonstrate the company's profitability.

3. Cash- Flow Statement: This statement shows the inflows and outflows of cash equivalents over the course of a specific time period. It offers details on the sources and applications of cash, including operting, investing, and financing activities.

4. Statement of Change in Equity: During a certain time period, this statement shows the change in a company's shareholders' equity. It contains details regarding retained earnings, share capital, and other equity components.

To promote consistency, comparability, and transparency in financial reporting, financial statements are prepared using generally accepted accounting principles (GAAP0 or international financial reporting standards (IFRS). They are essential for assesing a company's financial health and performance by external stakeholders like investors, creditors and regulators. Financial statements are also used by internal stakeholders, such as management and staff to help them defensible decision and assess the company's development.