It’s no secret that we’re living in a time of significant economic upheaval. In light of the current volatility, it’s more important than ever that companies take steps to protect their financial future by leveraging data in their financial reporting.
Recognizing that organizations with access to and insights into the most data have the best chance of weathering ongoing uncertainty, savvy business owners are taking steps to improve their financial reporting. Here are some tips on automating the reporting of financial data to make crucial decisions with greater confidence in the numbers.
Key financial reports to run
Accurate, actionable data can mean the difference between your business falling on hard times or weathering the storm. Here are some of the key financial reports to run if you want to give your company the best odds of achieving its goals:
A crucial element for any business, the balance sheet offers insight into the company’s assets, liability, and equity accounts. This lets decision-makers see what the company owes and owns in assets and investments at a given point in time.
A business can’t operate or plan for the future if owners don’t know the current financial status. Your income statement should reveal revenues and expenses, as well as the net loss or income.
Cash flow statement
Cash is king in the business world, and you can’t achieve your goals if you don’t know how much money is flowing in and out of the organization. This report should provide information on operations and investments that rely on cash.
Shareholder’s equity statement
Another important report, the shareholder’s equity statement shows how the equity section of the balance sheet is changing over a given period.
The importance of automated financial reporting
Business owners and decision-makers know that generating reports takes up a great deal of time and energy. Fortunately, automating financial reporting can improve both speed and accuracy. FP&A software enables companies to access the information they need without having to input data manually. Not only does automation reduce the odds of errors and discrepancies, but it also allows for companies to share information with multiple individuals. As a result, decisions can be made faster and with greater efficacy.
Critical reports to automate
If you want your business to achieve its goals in the coming year, automating certain critical reporting is essential. One of the most essential reports, the balance sheet, shows an organization’s assets and liabilities as well as shareholder equity at a glance. This information can be useful for creating other reports as well. For example, you can utilize the assets section of the balance sheet to generate a cash flow report and your shareholder’s equity statement. By automating the balance sheet, you make it easier for your company to access other reporting and make better decisions moving forward.
Avoiding analysis paralysis
Data is undoubtedly the most important tool you have when it comes to guaranteeing your company a bright future. And while it’s crucial to monitor your financial reports and performance, those with access to large amounts of data sometimes suffer from a condition called analysis paralysis. Information is only helpful if you use it to make thoughtful choices. While you might be tempted to analyze and reanalyze data or search for the details you want to see, ultimately this habit can be detrimental. For best results, you should set a time limit for reviewing reports and stick to it. The goal is to avoid getting lost in your data.
Financial reporting best practices for today’s economy
In the current economic environment, it’s crucial to follow the financial reporting best practices. Many companies are dealing with reduced demand for goods and supply shortages that make it harder to do business. One of the best ways to mitigate these issues is to engage in better business planning. By anticipating complications before they come, you improve your odds of making the kinds of decisions that safeguard your interests and help you achieve your goals.
Sophisticated financial planning and analysis software tools like Centage allow businesses to improve access to data, giving them the information they need to navigate what’s coming. Along with improved forecasting, Centage delivers superior financial reporting, enhanced performance, and easy collaboration. That means you don’t have to wait while information trickles down to various levels and departments.
Book a demo to learn how Centage can help you get a better handle on the data that matters most to your company's long-term resilience and success.