← Financial Management for SMEs: Financial Control and Decision Making

Financial Statements for SMEs

Module 02 / 6 · 65 min

Prepare and read the income statement, balance sheet and statement of cash flows under IFRS for SMEs, with the accruals, filing and audit duties of an Ethiopian company.

In this module you will learn to

Explain which Ethiopian entities use IFRS for SMEs under the Financial Reporting Proclamation No. 847/2014
Prepare a monthly income statement and balance sheet and check that they balance
Record the accruals that make monthly accounts reliable: depreciation, income tax and the allowance for doubtful receivables
Prepare a statement of cash flows by the indirect method and reconcile it to the bank
Plan the monthly close, the audit and the AABE filing deadline

Built on

Erudite Africa training curriculum: Financial Management for SMEs, Level 2 Intermediate, Financial Control and Decision Making (October 2026)
Financial Reporting Proclamation No. 847/2014 and the Accounting and Auditing Board of Ethiopia (AABE) adoption of IFRS for SMEs; Commercial Code Proclamation No. 1243/2021
Federal Income Tax Proclamation No. 979/2016 as amended by Proclamation No. 1395/2025, and Council of Ministers Income Tax Regulation No. 410/2017 (depreciation rates)
VAT Proclamation No. 1341/2024, VAT Registration Directive No. 1104/2025 and Electronic Invoicing System Administration Directive No. 1142/2026
Federal Tax Administration Proclamation No. 983/2016 as amended by No. 1434/2026; Private Organization Employees' Pension Proclamation No. 1268/2022; Labour Proclamation No. 1156/2019
Published good practice on 13-week cash forecasting, working capital management, management accounts and spreadsheet controls

Examples and companies are fictional. Tax rates and rules are shown as they stood when the course was written; always check the current proclamations, directives and guidance from the Ministry of Revenues before filing, and take professional advice for your own case.