A System for Financial Performance Reporting (draft of guidelines)
When you meet with your advisors, you will want these reports:
1. balance sheet as of the last business day of the last month with comparison to the same period last year.
2. profit and loss statements
a. for the full prior month, with comparison to same month last year
b. for the year to date, with comparison to same period last year.
3. you will want to have these items graphed:
a. actual sales by month, last year and this year, with target sales
b. net profit by month, last year and this year, with target net profit
4. also, you will want to have several key ratios calculated to summarize the financials:
ideally, these numbers will be graphed, by month, last year and this year,
a current ratio,
b. net profit %
c. gross profit %,
d. inventory turns,
5. you will continue to add ratios and reports as needed for our meetings, and other reports for various departmental analyses (marketing, sales, inventory, etc)
6. you will want to review these reports in detail prior to sharing them with your advisors, and if there are any numbers that you find to be inaccurate, then you will want to get them corrected and fresh reports printed, or you will want to make manual corrections to the reports on the copies that you share.
7. you will want to share these reports several days in advance of meeting with your advisors so that they will have sufficient time to review them in detail and possibly get questions answered before the meeting, but in any case you will have much more productive meetings.
8. if you prepare this way for your meetings with advisors, you will put yourself ahead of 95% of small business owners, and very favorably impress your advisors to give you their best support.