The provision of accounts is not confined to a historical profit & loss! There are a number of reports that Should be considered including cash flow, budget, KPIs to a number of analysis reports to provide critical information to your business’s well being including performance and measurement.
Analysis can also be performed on the financials to provide management with measurements on performance and viability. Such statements may are be used as part of management’s annual report to the stockholders.
Financials aren’t the only reports that are important. Consideration should also be given to business planning, budgets, benchmarks, KPIs and business analysis. See our section under Business Planning
Some of the financial reports include:
Profit & Loss: Annual, quarterly or monthly profit report and may include a comparison to previous years. Ideally, this is also required for taxation, cash flow and budgets as well to measure how your business is going.
Balance Sheet: Statement of the financial position of assets, liabilities and ownership equity. A variation report can also be prepared to show the movement of assets & liabilities from one year (or period) to the next. The Balance Sheet is important in reporting on the assets & liabilities that also measure the health and solvency of the business.
Cash Flow Forecasting: Predict cash flow up to several years in advance to be aware of any possible future funding shortfall or plan for future financing. Generally prepared on a spreadsheet, the cash flow can also include variables to reflect best, worst and breakeven scenarios.
Budgets: Calculate the expected revenues and outgoings for a comparison with the actual revenues/expenses achieved. Your business software may have the ability to record budget amounts and include these figures against actual figures in reports such as the Profit & Loss.
Debtor Reports: Reviewing these reports is vital to ensure the monitoring or improvement of account payment collection. Customers who pay their accounts on time are absolutely essential to good cash flow. Producing these reports allows an age analysis to be conducted and understand how well accounts are being paid.
Supplier Reports: Required to keep track of supplier accounts and ensure your business retains a good credit history with your creditors. Also used to plan payments as they and when become due.
Stock & Inventory Reports: Used to review and analyse stock levels. Too much unnecessary inventory on hand can result in tightening cashflow. Identifying slow moving stock as against high demand stock can be used to reduce tying up too much cash in stock that doesn’t sell.
The above are examples of some of the reports that can be prepared for review. Feel free to discuss the requirements of your business.
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