Financial reporting and analysis is key for driving company growth and success. When your finance teams are equipped with the knowledge and the tools to accurately create financial reports, whether through financial reporting software or otherwise, they’re powering the business with more detailed analysis, allowing you to better forecast and inform your business decision-making and they’re giving you the resources to accurately report on products, suppliers, customers, and more.
There are a number of different accounting and finance reports you can utilise. Some of the common ones include cash and cashflow forecasting, income statements and balance sheets, but below are 3 that you likely aren’t using… but probably should be.
3 financial reports businesses can start analysing to make better business decisions
Sales Analysis Report
Sales analysis reports are essential for businesses when it comes to informed decision-making. If you choose to implement, you should look to review on a daily basis (weekly, at least). This report is ideal because your sales figures are so important, so why would you not be monitoring and analysing them?
What you include is up to you, but a few things to consider monitoring are sales data: by product, customer segments or sales representative. When you collate this data accurately you can get a much better reflection of how your sales are doing in comparison to targets for the month, quarter or the year.
This report is ideal for monitoring sales, in particular any trends over time. It also gives you an accurate look into your company’s financial position at any given time and allows you to determine where sales or doing well, or not so well. This makes it much simpler to understand where you may need to turn your attention to, to help increase sales.
Net Profit Over Time
By tracking and monitoring your net profit over a number of months and year, you can help senior decision-makers in your business make informed decisions about strategy and focus areas, based on real-time, accurate data.
Using data from several quarters and years can influence the decisions that are made around future pricing, budgets and sales efforts. You can monitor how every penny is made from sales and how they vary depending on the time of year, helping to spot trends by product, customer and industries.
Equally important as monitoring sales and profits, is monitor your customers and their buying patterns and behaviours. This one might not be the first one to come to mind when you think of financial reporting, but it is really important to consider when you think about reports that affect financials.
Whether you are business-to-business, or business-to-customer, customer-centric reporting is key to focusing on performance. As a B2B business, you may look to analyse customers on engagement and profit/debt. By monitoring customer behaviours, you can enjoy better debt and cash-flow management.
As a B2C business, you may focus on repeat orders and trends. By looking into customer behaviours you can better identify buying patterns and trends which can influence any future sales and marketing campaigns to help increase profits.
All in all, it’s key that you have your financial reports in order – there are several that you will do as standard such as analysing balance sheets and profits, but it is definitely worth considering implementing some or all of the above, so you can take a deeper dive into your data and make decisions off the back of it that help to improve real-time tracking, trend identification and better cashflow management.