Introduction to the three core financial statements
FREE03 – People Professionals and Finance
This CIPD Level 0 video introduces learners to the three core financial statements as part of the FREE03 – People Professionals and Finance unit, directly addressing assessment criteria AC 1.1 on explaining key financial terms and statements used in organisations. The video covers the profit and loss statement, balance sheet, and cash flow statement, whilst unpacking essential concepts including revenue, costs, profit margins, fixed versus variable costs, and the distinction between capital and revenue spend. Through this introduction, you'll gain a foundational understanding of how organisations use these financial statements to communicate their financial position and performance, equipping you with the knowledge to engage more effectively with finance professionals in your HR role.
Assessment Criteria 1.1
Explain key financial terms and statements used in organisations.
Indicative Content
To include: profit and loss (income statement), balance sheet, cash flow; revenue, costs, profit, margin; fixed vs variable costs; capital vs revenue spend; depreciation (high level); working capital (high level).
What You'll Learn
Video covering: Introduction to the three core financial statements
About FREE03 – People Professionals and Finance
To develop learners’ understanding of essential finance concepts in business and how people professionals use financial insight to support workforce decisions, budgets and organisational performance.
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