Are You an Entrepreneur? Here Are the Key Reports You Need to Run Your Business Successfully

Tally Solutions | Updated on: May 19, 2023

• Importance of business reporting
• Key reports to successfully run your business

Importance of business reporting

Business reports enable you to keep track of your business so you can make changes when it deviates from the path you envisioned. These reports are vital for every business, from a start-up to an enterprise, because every business has scope for improvement. Reports can be seen as reference points that give you a snapshot of your business during a period. They are as important for a bakery business as they are for a clothing store. Business reports in accounting are used by insurers, accountants, managers, and lenders.

Insight into specifics

When you generate a business report using accounting software such as TallyPrime, you get clear insights. You can generate an annual report or a more specific report as you require. It gives you the power to get general information or understand a part of your business in granular detail. These particulars would be difficult to see on your own as there is way too much data, even in a small business. The insights can be used to make decisions that benefit your business in a myriad of ways.

Unveil problems

Reports can unearth problems in your business that you didn’t notice before. This enables you to rectify the issue before it becomes more complex that affects your entire business. Perhaps you underestimated the loss while you incurred a loss of thousands of dollars. Generating reports regularly allows you to identify problems if any, and then work on the solutions to those problems by identifying where they came from.

Discover opportunities

Just like you can identify problems, you can find opportunities that were not apparent before generating reports. Business reports allow you to understand whether you have an opportunity to expand and succeed based on data in the report. It shows you the feasibility of the opportunities based on historical data and whether you have funds for the idea you have been nurturing about your business.

Key reports to successfully run your business

Running your business is simpler when you generate reports to understand different aspects of your business.

Accounting reports

Accounting business reports are financial reports that tell you about an aspect of your business such as outstanding payments that must be paid by customers and payments that are due from your side to suppliers.

Outstanding payables

An outstanding payables report shows you how much you are required to pay another party by a pre-agreed date. This includes overdue payments by your business. The report specifies the amount due, the overdue days, the due date, and the party name you owe. This report helps you manage cash flow in your business by knowing exactly how much you owe and keeps you on track of your expenses so you can pay off what you owe timely.

Outstanding receivables

The outstanding receivables report shows you which parties owe you money, by when they need to pay it back, and how much they owe you. This report helps you maintain cash flow in your business because you can ask the parties when they don’t pay back on time and recover those payments. You can then spend on the area of your business that will promote growth and enable you to achieve your business goals.

Inventory reports

Inventory business reports provide you with an understanding of everything related to the inventory stored in your various warehouses. Inventory management is crucial for your business’s success, and generating reports help you manage your inventory with ease through better visibility. 

Stock summary

The stock summary report lets you know what stock you have at hand on the day you generate the report. If you have divided stock into groups, you get a detailed group-level summary of the stock. You also get information about which stock items you sold on that day, which items you purchased, and which items were used during the day. The stock summary is excellent for day-to-day analysis of inventory.

Stock aging analysis

A stock aging analysis report is important for businesses that store items in warehouses that can spoil if not used within a particular time frame. By knowing which items are nearing their expiration date, you can sell those items at discounted rates to ensure none of the stock gets spoiled in the warehouse. This saves money, prevents loss, and clears up your inventory while driving profits, as you will sell more when the stock items are provided at discounted rates.

Location summary

The location summary lets you know which items are stored at each location and their quantity. You can track the transactions related to every stock item or view the consolidated details of each group if you have grouped them in a hierarchy. The location summary lets you understand the situation of stock items at every warehouse with ease and you have the information at your fingertips to distribute stock items for higher efficiency.

Re-order status reports

Re-order status reports show you the net stock available. It shows what stock items are available at every location, the number of pending orders, the number of pending sales orders due, and the pending purchase orders. You can then decide how many stock items to reorder based on the information provided in the status report to ensure you never run out of stock that is always in demand.

Movement analysis

A movement analysis report is useful when comparing stock items in your business. You can find out which stock items move slowly so you can do something about expediting the rate at which they move. Slow-moving items block the movement and cause inventory to be stuck in warehouses for longer, thereby blocking cash flow. When you improve the movement of your stock items, the cash flow increases. 

Financial reports

Financial business reports give you insights into the business finances over a period. Whether it is determining the profit and loss, or your financial position compared to earlier, financial reports are key reports that must be generated regularly.

Balance sheet

A balance sheet is useful for lenders and investors as it shows the financial health of your business. They can determine if your business is worth investing in by using the balance sheet. It is used to determine trends that help you make informed decisions. The balance sheet contains information on your liabilities, assets, and stockholder equity for a period you specify. It is used to determine the current state of your business, such as how much you own and what you owe.

Trial balance

The trial balance is one of the reports every business must generate, particularly if you are not using accounting software. It is used to ensure the credit and debit balances are equal and accurate. The trial balance is used to generate other financial statements, such as balance sheets and cash flow statements. It is used to ensure no errors exist in accounting, and auditors use it to determine which accounts they need to audit.

Ratio analysis

Ratio analysis is used to determine your business’s financial health by comparing the current financial statements with previous years. This helps you understand how your business is likely to perform in the coming years. Ratio analysis can be used to compare your business with similar businesses and to see where you stand in the industry. It is helpful for investors too, as they can compare stocks of different companies with yours.

Profit and loss statement

Also known as the income statement, the profit and loss statement reveal your expenses and revenues during a period. It shows whether you incurred losses or profits during that time. The income statement is of importance to all stakeholders as they can understand the benefits and risks associated with your business. It is used by creditors and investors as they will lend or invest in your business when your revenues exceed your expenses most of the time.

Cash flow statement

The cash flow statement shows all the cash flowing into and out of your business during a period. It accounts for only cash-related activities. It gives you details of your investments and financing activities and should be generated monthly. It is used to determine future cash flow and helps you maintain optimal cash in your business. It can be used for planning purposes as it shows fund utilization.   

Management control reports

Management control business reports are used mainly by the management to change how processes are done in your business. They can be used for a variety of purposes; to understand business expenditure, to forecast spending, and to give business performance information.

Budget variance

The budget variance report lets you have better financial control because you can plan well. You can set a budget and then compare it to the actual expenses that were incurred. Then you can take a look at both, side by side, with the budget variance report, which highlights the differences showing you how close or how far you were from what happened in reality. The budget variance report is helpful for future planning, both short and long-term.

Cash flow projection

The cash flow projection report shows you how your cash flow is likely to be in the future. It lets you see how your decisions will impact your business finances and whether you have enough funds to turn your plans into reality. It promotes business management as it predicts how much you are likely to spend and how much you can make in a period. It differs from the cash flow statement as it shows what may happen in the future based on past data.

Market analysis reports

Market analysis business reports are used to evaluate the market at present, which makes decisions easier. When you perform any activity with the current market in mind, your business will thrive as it is seizing opportunities available in the market at present. If not, it is like shooting in the dark, and you may hit the mark, but it is never guaranteed. Every business should focus on market analysis reports as they will show you where you are positioned in terms of your competitors and in which areas you can improve. The market analysis must be regularly performed to ensure you are in a good place.

Generate reports with TallyPrime

TallyPrime can generate over 400 unique business reports. Whether you prefer general reports about your business or you want a comprehensive report, TallyPrime has what it takes to generate all types of reports you need. You need to set parameters and let the software do its job of generating reports in seconds. This quick reporting style is accurate and up-to-date and provides all the insights you need for making decisions that impact your business. As an ERP system that curates all your business data to create reports, TallyPrime provides you with the flexibility you need to understand your business.

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