Lenders do not use income statements and balance sheets with information about past transactions or events to make decisions unless they are accurate. The balance sheet is a “statement at a certain point in time, showing all assets controlled by the entity and all obligations owed by the entity.” (Bazely, 2007, p90) It therefore simply provides a picture of an entity's financial strength and asset liquidity. The income statement “summarizes certain transactions that take place over a period of time.” (Bazely, 2007, p125) So the income statement provides some of the basic financial information for making rational decisions. Lenders are “people and organizations who lend money to earn a return on that money.” (Bazely, 2007, p8) Therefore they are interested in ensuring whether the entity will provide a return due to the entity making sufficient profits. Therefore, although the balance sheet and income statement provide financial information regarding past transactions or events, lenders will not include the balance sheet and income statement in making decisions because many limitations of these statements influence the decisions you make. Lenders are interested in the assets entities control and what they owe. Therefore the limitations of the balance sheet clearly affect the accuracy of the statement. These include: the representation of the position of an entity at a particular point. The statement is relevant only at that particular moment; the utility of the statement diminishes over time to provide relevant measures of an entity's assets and liabilities as the values ​​assigned are usually historical cost; Furthermore, the asset valuation method needs to be properly measured as some cases lead to a misreported figure. Lenders use a variety of approaches to arrive at a loan decision. Therefore, the accuracy of the income statement limits the decisions made by lenders. First, organizational structure, size, and type of business limit the accuracy of the statement as it affects what is reported and how it should be reported, which may omit some important aspects of the organization. Secondly, the income statement is normally prepared for internal use by an organization with which these internal reports are generally more detailed than reports produced for external users, limiting the sufficient accuracy of the information needed to make a decision. Although companies develop financial statements and revenue statements they are primarily for internal use.