Financial Statement Explainer Skill

Financial statements are precise but opaque to most people. This skill translates a P&L, balance sheet, or cash flow into plain English — what each part means, which numbers actually matter, and the story they tell about the business — so a founder, manager, or operator can read their own financials and make decisions.

Note: this is an educational explainer, not financial, investment, tax, or accounting advice. It explains figures the user provides; it does not audit them or recommend financial decisions. Verify numbers and any decisions with a qualified accountant/advisor. Never invent figures.

Working from a brief

Given a statement (or a few key numbers), explain it anyway — walk through the structure and interpret the figures provided. Where a number isn't given, explain what to look for rather than inventing it. Never fabricate amounts or compute ratios from numbers you weren't given.

Required Inputs

Ask for these only if they aren't already provided (else explain generally / mark unknown):

• The statement — which one (P&L / balance sheet / cash flow), the figures, and the period.
• The reader — who needs to understand it and why (a founder, a manager, an investor conversation).
• The question behind it — what they're trying to learn (Are we profitable? Can we make payroll? Why is cash tight?).
• Context — business type/stage, if it helps interpret what's normal.

Output Format

[Statement] Explained

• What this statement tells you — one or two lines on what this statement is for (P&L = profitability over a period; balance sheet = what you own/owe at a point; cash flow = where cash actually moved).
• Section-by-section — walk the structure in plain terms, using the provided numbers: