Retained Earnings Statement
A financial statement showing changes in undistributed profits during a period, reconciling beginning and ending retained earnings balances.
Retained Earnings Statement
A financial statement that shows the changes in a company’s retained earnings during a specific period, reconciling the beginning and ending balances through net income or loss and dividend distributions.
For example, a company might start the year with $300,000 in retained earnings, add $100,000 in net income, subtract $30,000 in dividends declared, and end with $370,000 in retained earnings.
This statement, sometimes included as part of the statement of changes in equity, provides information about a company’s dividend policy and self-financing capacity. It shows how much profit the company has reinvested rather than distributed, reflecting management decisions about balancing shareholder returns with funding future growth.