What is a comparative statement?

Comparative statements are financial statements that cover a different timeframe, but are formatted in a way that makes line items comparing from one period with those that are easy in another period. This quality means that a comparative statement is a financial statement that is well suited to the comparative analysis process. Many companies use standardized formats in accounting functions that facilitate and easy to generate a comparative statement.

The benefits of a comparative statement are changing for corporation. Given the uniform statement format, this is a simple process of comparing the gross sale of a given product or all products with gross sale generated in the previous month, quarter or year. Comparison of generated income from one period to another period can add another dimension to analyze sales effort, since this process allows you to identify trends such as decrease in income despite the increase in units sold.

, along with the fact that it is an excellent way to extend the understanding of sales efforts, a comparative statement can also help solve changes in production costs. By comparing line items that catalogs the cost of raw materials in one quarter with another quarter, where the number of units produced is similar, it can allow trends in the cost increase, thus helping to insulate the origin of these increases. This type of data can be useful for companies to find raw materials from another source before the increased price to reduce materials to the company's total profitability.

A comparative statement can be useful for almost any organization that has to deal with finances in some way. Even non -profit organizations can use a comparative statement method to identify trends in a growing effort to obtain funds. By using a comparative statement for the last effort and comparing data with the ÚDAIt can be determined from the previous year where the costs have increased or decreased and provide some information about how to plan the next year.