Refresh your financial reporting in the New YearPosted: January 7, 2013
Have you looked at your financial reporting with a fresh eye lately? Is it looking a little tired, out of date, or even irrelevant? The start of a New Year is a great time to take a good look at what you’re producing every month to make sure it is the best quality financial reporting you can be giving to your end users.
One of the reasons I like NAV account schedules for my financial reporting is this tool gives me the flexibility to change what I want when I want. One of those times is at the beginning of the new fiscal year.
Here are some of the things that I look for:
- Primary account use and classification – Look through the accounts and categories used for your balance sheet, income statement, and other primary financial statements. Are they still the main accounts being used or are you showing small balances and tiny net changes because the accounts are no longer being used as much as they used to be? If you find some of those immaterial numbers cluttering up your statements, group them together with some other logical account. This will keep your financial statements crisp, concise, and focused on the big picture.
- Names and labeling used – Think about the wording used on your financial statements. Many times, we call an account, or a brand, or a team one thing on a report, but throughout the year the name we actually use in the company becomes something else. If you’re paying attention through the year, you can catch up the names used on your reports to match the more familiar uses that have currently evolved in your company and instantly make your financial reporting connect with your end users by using the same language they do.
- New accounts – The end of the fiscal year is the most likely time for companies to add accounts. Make sure to trace those new accounts through your financial statements and make sure they’re included everywhere. This should keep you from having to track down some crazy imbalance later in the year.
- New budgeting categories – The annual budgeting process will surface all types of new needs, especially when involving operating or management reports. Make sure new budget categories have been included in your reporting, and that you’ve designed your reports to be flexible enough to report on the coming year’s forecast as well as on the prior year’s historical information.
- Recheck formulas – As always, whenever you make any changes to your financial statements, check and double-check that you haven’t changed or broken any calculations. Spending time now to make sure these essential elements are still working is the best way to save yourself time later.