Financial adjustments refer to changes made to financial statements or budgets to reflect accurate information. These adjustments can occur due to errors, changes in accounting policies, or new financial data. They ensure that the financial records present a true and fair view of an organization’s financial position. Common types of financial adjustments include accruals, deferrals, and reclassifications. Accruals involve recognizing revenues or expenses that have occurred but are not yet recorded. Deferrals delay the recognition of revenues or expenses until a future date. Reclassifications involve moving amounts between different accounts to better represent financial activities.