What is the primary purpose of the statement of stockholders' equity?

The primary purpose of the statement of stockholders' equity is to provide a comprehensive overview of changes in ownership equity during a specific fiscal period. This statement details how various components of equity, such as common stock, preferred stock, additional paid-in capital, retained earnings, and accumulated other comprehensive income, have changed over time. It allows stakeholders to understand how profits are retained or distributed, including dividends declared, and how new shares may have been issued or repurchased. This information is essential for investors and analysts as it illustrates how the company is managing its equity base, allowing them to make informed decisions regarding investment and assessing the overall financial health of the corporation.