Keeping An Eye On Your Business Health
The accounting reports you need to have done regularly for your business are very important for success–you need to know where you are to see where you need to go. Checking your reports quarterly or even monthly can also help you to see trends–what is working and what is not. We’ll look at a few of the more important ones here.
Profit And Loss Statement
From Investopedia, “The profit and loss (P&L) statement is a financial statement that summarizes the revenues, costs and expenses incurred during a specified period, usually a fiscal quarter or year.”
This is a very important report to run and examine. It can tell you at a glance how your business is doing–are you generating income (and how much), or are you running at a loss? Where is your income coming from, and what are your biggest expenses?
Says The Balance Small Business, “A balance sheet is a statement of the financial position of a business that lists the assets, liabilities and owner's equity at a particular point in time. In other words, the balance sheet illustrates your business's net worth.”
The profit and loss statement compares the changes in accounts over a set period of time; the balance sheet is a snapshot of your business assets versus liabilities at any point in time. Both are important to see where your business is, and where it is going.
Accounts Receivable Aging
Accounting Tools notes, “An accounts receivable aging is a report that lists unpaid customer invoices and unused credit memos by date ranges.”
It’s a business fact of life; whatever you excel in, whatever your passion is, you must also take care of your accounting if you want your business to succeed. This means invoicing clients, collecting money from clients, and keeping track of clients who are not paying on time.
For a little more detail on Financial Reporting, have a look at this video.
Shaw & Associates can look after all of your accounting needs, including generating all the reports you need and sitting down with you to go over these reports.
Contact Shaw & Associates Chartered Accountants for accounting help you can count on. One complimentary meeting with us will put you and your business on a more profitable and positive path.