What are financial statements primarily used for?

Financial statements are primarily used to summarize the financial conditions and operations of a business. They provide critical information about a company's performance over a specific period, including its revenues, expenses, assets, and liabilities. This summary allows stakeholders, such as investors, management, and creditors, to assess the company's financial health, make informed decisions, and plan for the future.

The information contained in financial statements, such as the balance sheet, income statement, and cash flow statement, serves as a foundation for budgeting, forecasting, and resource allocation within the business. By combining historical data with current trends, financial statements help in tracking financial performance against benchmarks and previously established goals.

In contrast, employing financial statements for planning marketing strategies, managing human resources, or enhancing customer relationships does not capture their primary purpose, which is focused on financial reporting and analysis. While these aspects may benefit from insights gained from financial data, they are not the primary use of financial statements.