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Financial statement notes are the supplemental notes that are included with the published financial statements of a company. The notes are used to explain the assumptions used to prepare the numbers in the financial statements, as well as the accounting policies adopted by the company.

A note is a legal document that serves as an IOU from a borrower to a creditor or an investor.Notes can obligate issuers to repay creditors the principal amount of a loan, in addition to any interest payments, at a predetermined date.

Accounting disclosure notes are included in the footnotes to an entity's financial statements. These notes reveal certain important facts about an entity's finances that are not shown elsewhere in the financial statements.

The notes are used to make important disclosures that explain the assumptions used to prepare the financial statements of a company. Common notes to the financial statements include accounting policies, depreciation of assets, inventory valuation, subsequent events, etc.

The financial statements are used by investors, market analysts, and creditors to evaluate a company's financial health and earnings potential. The three major financial statement reports are the balance sheet, income statement, and statement of cash flows.

The main purpose of the notes to the financial statements is to further clarify accounting procedures used by a company, as well as to divulge information that has occurred during and immediately after the close of the accounting period.

Notes to the financial statements disclose the detailed assumptions made by accountants when preparing a company's: income statement, balance sheet, statement of changes of financial position or statement of retained earnings. The notes are essential to fully understanding these documents.