The upcoming discussion will update you about the difference between fund flow statement and balance sheet.
Difference # Fund Flow Statement:
1. It is dynamic in nature. It shows the changes in financial position between two dates.
2. It incorporates items causing changes in working capital.
3. It is a management tool for financial analysis and help in decision-making.
4. The preparation of this statement is a post Balance Sheet exercise.
Difference # Balance Sheet:
1. It is static in nature. It is prepared at the end of accounting period and portrays the financial position on a particular date.
2. It includes the balance of real and personal accounts and shows the total resources.
3. It reveals the financial position of a business firm and one can examine the soundness of the firm.
4. It is the end product of all accounting operations for a particular period of time.