Fraud Prevention:  One of the best ways to safeguard against embezzlement is to open your bank statement and review all cancelled checks.  Look to be sure the payee is valid and that all checks have an authorized signature. 

 

What are financial statements?: We are often very surprised when we ask this question of bookkeepers or owners of companies.

Answer: An income statement measures revenue and expense over a period of time, such as a month or a year. A balance sheet measures the assets, liabilities, and equity of a company at a point in time.

The accounting equation is assets = liabilities + equity or stated another way, assets less liabilities = equity.