Business Financial Report Intelligence
Business Financial Report Intelligence
Surprisingly many small business owners know little to nothing about their most important paper assets – their business financial reports. The numbers presented in business financial reports are carefully presented and are key to the financial success of any business – large or small. Why? Business financial reports provide the inside tract regarding the fiscal well-being of the company. Without a good working knowledge of these important business financial report numbers, your business financial report intelligence, a business owner cannot
determine whether the company is a success or heading toward an unrecoverable failure.
The Big Three Business Financial Report Statements
There are three main business financial reports or statements that are the basis for any company. Monitoring these reports, understanding the numbers they depict and determining important business trends will keep a business owner informed of the most important aspects of its health, including when it is in need of actions to head off problems leading to potential business disruptions.
The Income Statement
This statement is also known as the Profit & Loss Statement. It shows a company’s profitability over an established time period. Subtracting a company’s expenses from its income gives a resultant that is a snapshot of a business’ financial position over that period of time. The income statement is the first level of financial report intelligence you need to study and really understand.
The Balance Sheet
The basic accounting equation is paramount to the understanding of a business’ operations: Assets equals Liabilities plus business Capital (A = L + C). The balance sheet defines the three main elements of the equation where Assets are anything the business owns or is owed, Liabilities are what the business owes and Capital (also called Owner’s Equity) is what is left over or in other words the owner’s share of the business. The balance sheet is the second level of financial report intelligence you need to study and really understand.
The Cash Flow Statement
The statement of cash flows measures the flow of monies in and out of the business and also converts finances from accrual basis to cash basis. The statement of your company’s cash flows is the third level of financial report intelligence you need to study and really understand.
Managing The Business Using Financials
These financial statements are great tools for decision-making by determining cash flows and showing how well the business is collecting receivable accounts and paying its own obligations. The result is a good visualization of any cash flow problems that could be disruptive to the financial health of the company. It is vitally important that the small business owner demonstrates good business financial report intelligence by learning to read and understand these basic financial reports and how to take appropriate action as needed. Having inadequate skills regarding financial report intelligence often leads to business failure.
Why Dragon Financial Services Are So Important For Your Business
One of the largest complaints of small business owners is having to “do the math” for their business. Unfortunately math, financials and some owners just don’t “get along.” Dragon Financial, Inc. was founded to assist the hard working owners of businesses of all sizes with their understanding, interpretation and proficiency with the types of actions needed to keep a business in good, healthy working order. Utilizing Dragon Financial Virtual Assistant the business owner has 24/7, real time access to all of their business financial reports and business records using interactive technologies. To increase your financial report intelligence, contact Dragon Financial today and see how they can help you understand the many areas that will increase your business’ successes.