Insider Secret #2: Selecting and Reviewing Financial Reports.
Once you have organized your books and recorded all necessary information for your company, now comes the time to run and review financial reports to truly understand the health of your business. But do you know what reports to run? Do you know which reports will give the information you are looking for? Do you know what they mean? All good questions.
There are various accounting software programs on the market today, designed to organize and track your business, which includes painting an accurate financial picture of the health of your enterprise. We recommend and use QuickBooks for a number of reasons; one of them is the 100+ preset reports and customization capability. Different financial statements focus on different areas of your business. Here are the top 3 reports, that at a minimum, should be reviewed every month.
Profit and Loss Statement – offers the best measurement of profitability for your business and can be produced in detail or standard formats, YTD and previous year comparisons, by job and by department. It provides a reality check on income generated by customers, expenses by vendors/category and can display results in a graph format for easy interpretation. (Not everyone loves looking at numbers the way we do!)
Do you have a question about setting up financial reports in QuickBooks? Talk to us! We’re Certified QuickBooks ProAdvisors and ready to help!
Next month: Insider Secret #3: Selecting and Reviewing Financial Reports – Balance Sheet and Cash Flows Statements.