The income statement is an account synthesizing the whole of the loads and the produced of a company or another organization having a commercial activity, for a given period, called countable Exercice.

This document gives the Bottom line, i.e. what the company gained (benefit) or lost (loss) during the period, which is registered with the Bilan.

Intermediate balances of management

The income statement comprises, in its worked out version, of the intermediate Soldes of management describing how the result was built. This document determines as follows:

  • the commercial Margin: summon sales - nap of the purchases.

  • : --> This calculation is useful for the companies which resell materials without transforming them.
  • the Added-value: summon sales - nap of the purchases and services external (hiring, insurance, transport, etc).
  • : --> This indicator expresses the capacity of the company to generate a benefit starting from the services made near third.
  • the Turnover: added-value - (staff costs, taxes and depreciation).
  • : --> Expresses the capacity of the company to generate benefit starting from its principal activity.
  • the Financial result is obtained by difference between financial products and expenses.
  • the exceptional Résultat is obtained by difference between exceptional products and loads.

The balance final, known as Bottom line, is the sum of the three preceding intermediate results. It appears at the same time:

  • in the income statement, obviously,
  • and, in counterpart, with the Assessment of the company, in the stockholders' equity, preceded by a negative sign in the event of deficit (sometimes the negative sign is replaced by brackets for questions of presentation).

Use

The income statement forms part, like the assessment and various countable appendices, of the book of synthesis which are intended for the Financial information of the people
  • so much internal to the company: direction, personal
  • that external with this one, but having a situation of beneficiary: tax department, shareholders, bankers, suppliers, etc
so that they can judge performance and profitability of the company.

Example

Presentation of an income statement in list, with description of the intermediate Balances of management and their percentage compared to the turnover. This comparison is made to answer the question: " in 1 is unit of turnover, which the share of such result? ".
  • In the example below, the EBB represents nearly 52% of the turnover.
When the result is negative, this analysis loses of its direction.

Internal bonds

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