The notion of performance is linked to the proportion existing between means that are used to achieve something and the Outcome which is then obtained. In this way, performance is associated with benefit wave utility. Financial, for its part, is what is related to finance (money, capital or wealth).
The financial performance, therefore, is the gain that allows to obtain a certain operation. It is a calculation that is made by taking the investment done and the utility generated after a certain period.
In other words, financial performance relates to profit made with the resources used. Take the case of a person that makes a fixed term in a bank. This subject deposits $ 1,000 in a fixed term that will expire 90 days. After that period, you get $ 1,200; that is, received 200 dollars as interest. The financial performance of its fixed term, in short, was twenty%.
To all the above we have to add the existence of what is known as a statement of financial performance. It is a term that is used within the business environment to refer to the accounting summary that is carried out in an entity in terms of net income and expenses.
It is worth knowing other information of interest, such as the following:
-It is also called income statement or income statement.
-It can be presented once a month, quarterly or once a year.
-It becomes a very useful tool for the owners or senior managers of a company, since it is the material that allows them to know perfectly the main items of expenses and income on which the result obtained in the same will depend. a specified period.
-In the same way, by being able to know the profitability that a company has, it becomes a useful instrument when it comes to getting new investors who can be encouraged to put their money if they see that it is high or, at least, interesting.
-Among the expenses that must be recorded in the aforementioned statement of financial performance should be included from those that have to do with losses to those related to interest, sales costs …
-In the income section, it is important and necessary that sales, interest, those that have been obtained from gains in investments that have been made appear …
Operations with bonds they also allow obtaining a certain financial return. An entrepreneur can buy, in 2014, bonuses totaling 50,000 pesos. These bonds mature in 2018. When the date arrives, the person exchanges the bonuses for $ 80,000 pesos. For this businessman, the operation gave him a financial performance of the 60%.
Financial performance is often associated with risk and predictability. The return offered by a fixed term is usually lower than that offered by shares, since it is an investment that offers greater security.