Articles and guides on insights & analysis of your accounting reports.

We’ve previously discussed that sometimes the three core financial reports are not always enough to understand your business.

If you want to know where various departments in your organisation currently stand or you want to focus on specific aspects of your business, you need proper custom reporting.

Custom business reports are an important tool to increase efficiency and effectiveness in you day-to-day business operations. It supports organisational decision making and tells you the right questions to ask, by providing you access to the right information. When data is laid out in detail for each department, it is easy to understand, and it give you the information you need at a glance without going into the details or meeting with the department head every day.

By giving your staff the tools to monitor their performance on a weekly or monthly basis, you are able to make informed decisions at all levels of the organisation.

Custom business reporting improves the quality and transparency of information for key stakeholders in the company and allows them to make better informed decisions for the company. When you switch your focus from historical financial information (acquired from Balance Sheet, Profit and Loss Statement, Cash Flow Statement) that often fails at providing a more detailed picture of your business to incorporating relevant value drivers, management’s strategy, plans, opportunities, and risks, financial and non-financial performance measures, you are in a better position to make decisions for your business.

This improved custom business reporting model delivers a broader view of you organisation’s current performance and greater understanding of an entity’s future and what lies ahead for it. By looking at key aspects of your business you can create custom reporting to give you insights into what’s going on. You can look at using industry ratios as a starting point, such as the cost of wages per unit produced, total sales, total expense, etc.

Bookkeeping Charting

Custom business reports save you a lot of time. It helps you get exactly the information you are looking for in exactly the format you require it. Custom reports lay out information the way you want to see it. You can draw information from other databases into one place for you to assess the performance of your business and what steps are necessary to take in win future leads.

So, if you are looking for an efficient, quicker and reliable way to analyse your organisations’ profitability, custom business reporting contact Alexilum now to help you out.

The Standard Financial Reports

Recently we wrote about looking beyond the profit & loss report and understanding the role of the three core financial reports:

  • The profit & loss report shows the financial performance of the business over a period of time
  • The balance sheet shows the financial position of the business at a set point in time
  • The cash flow shows cash movement of the business over a period of time

Custom Reporting

While these provide a good overview of your businesses financial situation the structure of your accounts might still be hiding unseen issues or might not give you the answers you need to make the right decisions.

When you need to find the answer to a specific question or you need to focus on a single aspect of your business the three core financial reports may be too high and may not give you the answers you need.

This is where we need to start digging deeper and start getting into custom reporting that allows you to focus on certain aspects of your business. For example you may look at a profit and loss report that only shows:

  • Data within a specific time frame. For example you may have had a sale on and you need to check the performance of sales in that period compared to a similar period to see what the impact was.
  • Data for a specific division or department. You might have different departments, by looking at each department individually you can see how they are performing independently of the others.
  • Data for a specific region or store. If you have multiple stores one may be making a loss without you knowing it unless you can run reporting that focuses specifically on that store.
  • Data for a specific product. Check the performance of a given product by focusing on those sales only.

Knowing how you may need to ‘slice and dice’ your reporting means you can set everything up from the beginning to allow this. Most bookkeeping systems will allow you to categorise your transactions which you can then use as filters later on and focus on a given aspect of your business.

Bookkeeping Charting

Flexible custom reporting allows you to focus on the relevant information without the need to sift through huge amounts of data you don’t need, or accidentally exclude important information. You are able to drill down into fine details and discover possible insights you would not see otherwise. When you can break your data down into metrics that matter for your business, you can make smarter decisions and eliminate guesswork.

Key Requirements for Custom Reporting

Custom reporting relies on a few key requirements:

  1. Understanding what you are looking for – By either knowing the specific question you want answered or by at least specifying what particular aspect of the business you want to focus on we can determine what data to include or exclude from the report.
  2. Setting your data up for success – The reporting you can get out of a system is only as good as the quality of the data going into it. If you are not categorising your data entry or using the correct information there is no way to answer the first requirement above without manually sifting through the data to find what is relevant.

Running the Report

Most bookkeeping platforms like Xero, MYOB and QuickBooks have the ability to customise reports to a certain degree. Most will also allow you to filter your data based on categories you’ve set up.

If you’re stuck about how to set up your bookkeeping to get the most out of the information you’re putting in contact the team at Alexilum to help you use your data to answer the questions you’ve been looking for.

We can also create custom reports that are as individual as your business by using your data with our specialised tools and dig even deeper than what your bookkeeping system can do.

When I ask business owners about how things are going they generally say their profit and loss looks pretty good. The problem is that’s the only financial report that they look at and while it’s an important indicator on your business performance it doesn’t tell the whole story.

If you want to properly understand how your business is faring you need to look at three core financial reports:

  • Profit & Loss – also known as profit & loss report, statement of profit & loss or income statement
  • Balance Sheet – also known as a balance sheet report or statement of financial position
  • Cash Flow – also known as a cash flow report or statement of cashflow

All three reports are actually related and while each one focuses on a different aspect of your financial situation they work together to help you understand the overall picture.

Below we discuss all three reports and find out the reasons why business owners and managers need to look at them regularly.

Profit & Loss

The Profit & Loss report shows your financial performance over a period of time. It is made of two core sections, your income (also called revenue) and expenses. Depending on the type of business you have your expenses might be split into two sub-sections, cost of goods sold and general expenses otherwise it will just be one section called expenses.

  • Income/Revenue represents sales you have made
  • Expenses represents costs you have incurred
  • Cost of Goods Sold is a sub-type of expenses and is generally a type of expense when you sell physical goods
  • Profit is calculated as Income less Expenses and will give you either a Net Profit or a Net Loss figure

While this report is good at telling you what your sales and expenses have been it doesn’t tell you everything about your business, for example it doesn’t tell you if you owe someone money. It also doesn’t necessarily tell you how much money is coming in and out of your bank account.

Bookkeeping Analysis

Balance Sheet

The Balance Sheet represents the current financial position of your business at a fixed point in time. It’s generally set out in three sections:

  • Assets – This is anything that the business owns or is owed ie: your cash at the bank, furniture and equipment, sales you’ve made but haven’t been paid for yet
  • Liabilities – This is anything that the business owes someone else ie: a loan to a bank, superannuation you haven’t paid yet, purchases you haven’t paid for
  • Equity – This is the difference between Assets and Liabilities and represents the value to the owners

By understanding your Balance Sheet you can see what your current financial position is. For example generally if you have more assets than liabilities that would be a good position because it shows you have the capacity to pay off your debts while if your liabilities were higher than your assets you could have problems looming up ahead.

Bookkeeping Calculation

Cash Flow

The Cash Flow report shows what money is coming in and out of a business over a period of time. A lot of people think that the Profit & Loss report shows how much money is coming in and out of the business. This is not necessarily correct depending on how your bookkeeping is set up ie: if you buy some goods but don’t pay for them it might show as an expense on your Profit & Loss but in actual fact the money hasn’t been paid out yet, the same would go for sales made but you haven’t received payment yet.

The Cash Flow report specifically only looks at what cash is coming in and out of your business irrespective of what sales and expenses are appearing on the Profit & Loss report.

There are many different Cash Flow report formats and they tend to vary depending on your bookkeeping software. Generally though it will show how much money you have at the beginning of the period, what money has come in, what has been spent and how much is at the end.

Bringing it all Together

By understanding not only how each report looks at a different aspect of your business but by also understanding how they work together you can get a much better understanding of where you are financially.

If you would like some help on better understanding your own business contact us today and we can show you how to get the most out of your bookkeeping.

A large number of business owners think they have a pretty good understanding of their business due to their ‘gut feeling’. Listening to your instinct can be helpful but you may not be seeing the whole picture. Sometimes you need to take a step back and just look at the facts. You should know how your business earns revenue, what are the current trends in the industry and how they affect strategic priorities, financial success, and key performance indicators of your business.

Business Reporting help business owners to identify problems, find opportunities and adapt to the changing market conditions. It helps you understand where your business currently stands, where it is going and whether or not it is headed for trouble. Business reports are a valuable tool for tracking and analysing business performance and overall business health. A well-documented report reveals nuances related to core business functions, and opens up opportunities to improve and make market gains.

A business report is an important document that reveals specific information about your business. It can attract investors to your business and can keep your employees abreast of your company’s goals and achievements.

Day-to-day running of any business is very time consuming. It hardly gives business owners any free time to step back for a moment and see the bigger picture. When you are focused on the daily issues, it can be hard to get a good feel about where your business is going. As a consequence:

  • Small problems can escalate if they are overlooked for too long.
  • Opportunities can get missed if they are not availed on time.
  • Changing market conditions can badly impact your business if you are unprepared.

Business reporting can gives you a fast and accurate insight into your business. It helps you to quickly spot problems that are not always apparent, find opportunities and adapt to changes in your market.



Your business generates tons of data everyday. Every transaction constituting creates data like sales, purchases, payroll and inventory movement. Business reporting helps you use this data intelligently. When your business reports are based on your data, you can easily know where your business stands and where it’s going. Many business use Cloud-based business reporting software that connect to your online accounting software and extracts all the required useful data.

Cloud-based business reporting software makes use of your business data and offer you the following:

  • Identifies your most profitable products or services
  • Identifies late payers
  • Improves your cash flow
  • Filters clients by different criteria
  • Analyses your work-in-progress
  • Tracks your sales trends
  • Understands how your employees work
  • Analyses your team’s day-to-day work travel
  • Learns about staff habits and patterns
  • Creates custom reports

Business reports can be tailored to identify trends and not reveal sensitive information to employees, investors or clients. They can also help considerably in informed decision making. Accurate business reporting keeps track of the revenues and expenses and helps you devise strategies to eliminate costs.

Next Steps

Need to find out more about business reporting then contact us today to see how our experienced team can help you.

Are you in the process of preparing a basic budget for your brand new startup?

Do you want to know the steps that can help you put a solid budget plan into action?

The process of budgeting for small business owners isn’t limited to figuring out where to get the cash to meet next month’s payroll or BAS bill. Budgeting is the most powerful financial tool that is available to a small-business owner. Being a small business owner, when you maintain a good short and long term financial plan, you take control of your cash flow instead of having it control you.

Having a sound budget gives you the power to make your financial goals a reality. It can help you meet your strategic goals as well. But when you are preparing a budget, make sure you don’t map out a budget that you cannot meet. An effective budget includes both a short-range, week-to-week plan for at least a month and at most a calendar year. Budget provides you a plan only for the income statement and you should also cover balance sheet, this will enable you to consider all potential cash-flow needs for your startup.

The process of preparing a budget for your startup or company should be highly structured and follow a schedule, so that it is complete and ready for use before the next financial year begins.

Cash Flow Diagram


Follow the steps below for setting up a realistic budget that will get you where you want to go and what you want to achieve.

1. Identify Your Goals

The first step in creating a budget is identifying the goals you have for your business. Think through what you want to accomplish with your business and how much profit you want to make.

2. Review Your Financial Statements in Detail

Do a thorough review of your business documents that include your income statement, balance sheet, past tax returns, outstanding debts, assets, liabilities and a projection of immediate cash flow. If you have a budget you’re using currently for your business, use that as that will serve as a starting point for the new budget.

3. Define the Costs

Figure out the specific costs associated with each of your identified goals. Break down each of your goals into an annual tangible amount of money and further break it down by months. Fill in all of the costs, and conduct research to generate an approximate cost for each item you do not have the cost of.

4. Create Your Basic Budget

Gather the information from your business documents and specific costs and put them down on a spreadsheet. Your budget should be a tool that you use in your business on a daily basis. It is not a document that you create and then forget.

These steps will help you start off good good but it may be inadequate when you have to manage your cash flow as well. Once you have the budget, you need to create a detailed cash flow forecast. A cash flow budget guides you making the right decisions to ensure comfortable liquidity for your business and helps organisations anticipate cash flow issues and resolve them on time.

Next Steps

If you’re still not sure what to do next contact us today so one of our experienced staff can give you a hand.

In simple terms, a budget is basically a spending plan to  determine whether or not you will have enough money to cover costs over a given time frame. A monthly budget would factor in your income and your expenses with the end result being either a positive or negative number each month. A good budget will go a step further and help you plan for the future of your business.

Finding the Balance

Budgeting shows you whether or not a balance exists between income and expenses. The very same process is used in personal budgeting right on up to corporate budgeting. The goals are always the same – to balance the two or at least arrive at a surplus of revenue versus expenses. When the balance is tipped towards an excess in spending, then you have a problem on your hands. This is where the budgeting process becomes a valuable tool in sorting things out.

Trimming the Fat

The really interesting and most valuable part of making a budget is discovering places where money being spent can either be reduced or shifted to cover the cost of something else. In a personal budget, one way to reduce excessive spending may involve lifestyle changes. For example, eating out at restaurants every night could be reduced to two nights a week giving you a huge saving and extra money in the budget to spend on something else.

In the corporate world, cutting expenses is a regular way of life. When business is slow, revenues are reduced and cuts have to be made in order to stay in business. This sometimes results in severe cuts in departments to the point where downsizing occurs and some people lose hours or their jobs in order for the company to find the balance between revenues and expenses. Cuts may also be made in redundancies within the company to avoid lay-offs or cut backs in hours.

Building the Budget

One way to attempt to keep finances balanced is by creating a budget forecast. What this really is, is a projection made based on the costs and revenues you are aware of. In a home budget this could include utilities, rent, food, transportation and entertainment. Figures gathered from previous months could form the foundation of the cost forecast for the next few months. The amount of income collected from previous months would give an average figure that could be entered into the earnings portion of the forecast. The goal again would be to find a balance each month but with a forecast you would have advance warning of potential increases of expenses or income if factored into the equation. The very same method is used with business financial forecasts.

Budgeting for Growth

Well thought out budgets can be used to drive growth or identify unexpected opportunities. If you are looking to grow your business you can work out what it would cost to create that growth and include it in your budgeting plans. This will help you understand if you can afford those plans or if you need to make adjustments to help manage your risk.

After creating your budget you might also find opportunities you wouldn’t have otherwise known about. A surplus in a given month might allow you to invest in advertising, new equipment or even into your workforce.

It’s All in the Numbers

When you strip it down to the basics, budgeting doesn’t have to be more than some simple maths. The bottom line is a simple formula – income minus expenses equals either an excess or a deficit. But creating a good budget can be so much more as it can help you plan for the future growth of your business.

Next Steps

Most bookkeeping systems have a budgeting tool built in including Xero, MYOB and Quickbooks which will also allow you to compare your actual vs budgeted figures in an ongoing basis.

If you need help planning or updating your budget contact us to find out about our advanced forecasting tools that go a step further than your average budget.