Rise and Report - Why Your Small Business Relies on Accurate Financial Reporting

Rise and Report - Why Your Small Business Relies on Accurate Financial Reporting

If there’s one thing all successful business owners agree on, it’s that good information is vital to running a healthy business. You need the right financial information to manage your business effectively, make sure you can cover your costs, and understand what you have coming in and going out. Good accounting software will give you the insight you need through financial reports, and knowing how to use them can help your business grow and thrive.

Why Accounting and Financial Reports are Essential

Managing a business is complicated. You have to deal with sales, marketing, products, services, inventory, customer relationships, administration, and more. With all of this on your plate, it’s no surprise that financial reports may not be top of your list of areas to examine. The truth is that financial and accounting reports actually have some of the most important insight into how your business is doing.

Learn to understand them and you can:

  • Find out where all your revenue is coming from and learn about your main income streams.
  • See exactly where you are spending money so you can control costs.
  • Understand exactly how much money you have on hand at any moment in time.
  • Look at what you owe (salary, bills, and expenses you need to pay) and are owed (money coming in from customers.)
  • Work out how much you’re likely to owe in various taxes.
  • Explore your “return on investment” for the money you spend.
  • Make sure you’re accounting for every penny into and out of your business.
  • Chase up overdue invoices to enhance your cashflow.

AccountsPortal is designed to give you exactly the information you need, when you need it. Let’s dig into the various reports AccountsPortal provides and let you know how they can help you run your business.

The Profit and Loss Report or Income Statement

What the Profit and Loss Report Is

The Profit and Loss Report, also known as the Income Statement, is an indication of an Organisation's financial performance over a certain period of time. It shows the various revenues you have collected through invoicing and other monies in, less the costs you have incurred through expenses, bills, payroll, and other outgoings.

Why the Profit and Loss Report is Important

The Profit and Loss Report is one of the best indicators of the profitability of your business. Use it to:

  • Check you have more incoming revenue than outgoing expenses over a specified period of time.
  • Explore historic trends to see how your revenues and outgoings are changing over time.
  • Stay on top of your overall revenue and cost projections and ensure they are in line with what you expect.
  • Drill down into the various categories of income and expenses to segment and track exactly where your money is coming from and going to.
  • Make changes to enhance your takings, improve your margins, or reduce expenses.
  • Make reports to the tax authorities to determine how much tax you will pay.

The Balance Sheet Report

What the Balance Sheet Is

The Balance Sheet gives a snapshot of your business finances at a particular point in time. It shows what you own (your assets), what you owe to others (liabilities) and the capital invested in your business (including accumulated profits or losses).

Why the Balance Sheet is Important

The Balance Sheet lets you see exactly how much money is in your business, right now. Use it to:

  • Check you have enough cash on hand to pay your debts.
  • Create a cash buffer to protect your business if revenue goes down.
  • Ensure you have enough money to fund new initiatives and opportunities.
  • See how much profit you currently have in the business.
  • Understand how much you can pay yourself and other owners via dividends or drawings.

The Trial Balance Report

What the Trial Balance Is

The trial balance report lists the balance on all of your accounts. Each account will show either a debit balance or a credit balance. The Income Statement, Balance Sheet and other financial reports can be derived from the Trial Balance.

Why the Trial Balance is Important

The trial balance proves that the sum of all accounts with a debit balance equals the sum of all accounts with a credit balance. This is a critical part of the double-entry accounting system, and helps to ensure that your accounts are always in balance.

The Transaction Line Items Report

What the Transaction Line Items Report is

The transaction line item report is a line-by-line report of all the detail contained in every single transaction. Although AccountsPortal hides much of the complexity of double-entry accounting, the Transaction Line Item report is a great way to see what is happening “under the hood”.

Why the Transaction Line Items Report is Important

There are 2 mainpurposes to this report: firstly to check that each transaction is correctly balanced (i.e. conforms to the double-entry accounting system) and, secondly, as an analysis tool. As the report displays all the underlying detail of each transaction, you can make use of the report filters to drill down into various different aspects of your business. You can filter by date, transaction type, contact, account and category, thereby allowing you view the exact data that you are looking for. You can for example, view all sales invoices issued to a specific customer over the last 6 months or search for all expenses where a specific category has been used.

The Products and Services Report

What the Products and Services Report Is

This report shows the movement in your products and services over time. It will show exactly how much your customers are spending on each of your business products or services over any time period.

Why the Products and Services Report is Important

This report is mainly used to track your sales so that you can make better informed decisions on your products and services. Use it to:

  • Track how sales of products and services are doing over time.
  • Identify seasonal and other trends that impact exactly what you’re selling.
  • Plan for future revenue cycles so you can forecast more accurately.
  • Identify product and service lines that could be refined or expanded.
  • Track stock quantities to determine which items are nearing low or out of stock status.
  • Perform a “stock take” to ensure that your actual stock on hand matches your financial statements.

Other Reports

The Aged Receivables and Aged Payables Reports

The Aged Receivables report displays a summary of all outstanding Sales Invoices (and Credit Notes, where applicable) at a point in time. You can either view a summary report (where the information is aggregated on a per Customer basis), or a detailed report (where each individual invoice is displayed). One of the most important parts of the Aged Receivables report is that it breaks down the outstanding amounts into different “buckets”, depending on how long each invoice has been outstanding. This is a great way to see how long it takes each of your customers to pay their invoices, and you can quickly and easily see which customers are overdue.

The Aged Payables report works exactly the same as the Aged Receivables, but it references Supplier Invoices instead of the Sales Invoices.

VAT, GST, and Tax Reports

These reports help you to prepare your regular sales and purchases based tax returns and show you Value Added Tax or General Sales Tax owed to or due from your tax authority. AccountsPortal makes accounting for different tax rules easy, and lets you automatically add tax to your transactions.

EC Sales List and VAT MOSS Reports

In addition, AccountsPortal caters for all the relevant EU VAT reports, including EC Sales and VAT on EU Digital Services (i.e. VAT MOSS).

The Period Balances Report

The Period Balances report is similar to the Trial Balance report, but it also contains the movement in each account between two dates. This report will show the opening balance, as well as the period debits, period credits and the closing balance for each account.

As you can see, having access to the right range of accounting reports gives you a huge amount of insight into your business finances. Use these reports to understand exactly what you’re doing, make good business decisions, and manage every aspect of all the money flowing through your business.


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