How often are financial statements typically prepared for a business?

Financial statements are typically prepared on a quarterly and annual basis because these intervals align with the reporting needs of stakeholders such as investors, creditors, and regulatory agencies. Quarterly reports allow businesses to provide timely updates on their financial performance and position, enabling stakeholders to make informed decisions throughout the year. Annual reports are more comprehensive, encapsulating the entire fiscal year's performance, and are often required for public companies to comply with regulations mandated by entities like the Securities and Exchange Commission (SEC).

While daily preparation of financial statements may occur in certain industries or for internal management purposes, it is not standard practice for external financial reporting. Monthly statements may be utilized as part of internal management practices but are typically not as formal as quarterly or annual reports meant for external audiences. Therefore, the established practice of preparing financial statements quarterly and annually serves to meet the needs of various stakeholders effectively.