Accounting Reporting – The 5 Most Important Reports

Why Your Business May Be Running the Wrong Reports

If your business is like most, there are numerous reports generated that contain information about your business. However, it can often be difficult to figure out which reports contain the kinds of information you need most in order to run your business efficiently and profitably. In the end, many of the reports generated wind up never being read, or at least never examined as thoroughly as they should be. In fact, many companies are running the wrong reports or may even be running too many reports.  Designing the right report is critical to the operation of the business and to the business’ continued growth. Although situations do vary according to company circumstances, here is a list of five of the most important reports you need in order to help run your business.

Weekly Cash Flow Report

The weekly cash flow report is one of a company’s most important financial statements. This report is extremely important, especially for startups and small businesses, since they traditionally find it more difficult to generate the cash they need to keep their business growing. Although this statement is often generated monthly, small companies would do well to review and refer to this report on a more frequent basis, such as weekly.

Income Statement

A company’s income statement is generally a subcategory of its overall financial statements. It shows a company’s expenses, revenue and the corresponding profit or loss of the company. These reports are generated on a regular basis, according to a pre-determined schedule, which often translates into quarterly statements. These statements are very important when it comes time to complete SEC filings and taxes. These reports are also a good indication of the overall results of your company, and can be especially valuable to evaluate for a startup or small business.

Balance Sheet

The balance sheet is another subcategory of a company’s financial statements. This document will show, as of a specific date, the financial position of a company, including its liabilities, assets and the equity of the company’s owner. The liabilities will show the companies obligations as well as their due dates. The assets will include a company’s cash balance. As a general rule, this report is generated on a monthly basis.

Conversion Rate

This operational report can help you determine what your company is doing right (or wrong) in regards to leads and prospects. It will show the percentage of leads that end up being converted into paying customers. Not only can this report help you learn from what you are doing right, it can also help you pinpoint the things you may be doing wrong. For example, if certain members of your sales team are converting very few leads into customers, it might mean that they have unmet training needs.

Customer Churn and Referrals

These are actually two operational reports that work hand in hand to help show how successfully you are running your business. If you are making your customers happy, chances are you will find them listed on your referrals report. However, if you aren’t satisfying your customers, chances are you will find them listed on your customer churn report. If you are consistently acquiring new customers through referrals, then your business should be growing successfully. However, if most of your customers eventually end up on your customer churn report, you are likely having problems as a company.