Getting started on your maiden annual report can be a daunting task. Below are some steps to ease the process:
Step 1: Be clear about your readers
Before creating a financial report, it’s essential to consider who will be reading it, as the content should be tailored to the audience. For instance, a summary highlighting key financial indicators is more appropriate for non-professional readers, whereas a detailed report with all metrics might overwhelm them. If you want to avoid manually selecting indicators each time, you need a tool that allows you to store different financial report templates. I would like to recommend FineReport, which enables you to customise and save templates, so when the time comes, you only need to update the data within these templates, streamlining the reporting process.
In addition, company managers often need monthly financial reports. There are repetitive steps in creating reports manually. However, FineReport supports sending reports regularly to the managers, freeing you from repetitive work.
Step 2: Collect financial data
Compared with other steps, data collection is a relatively tiring step in financial reporting. Also, it is an essential step that determines the report’s accuracy. First, you need to collect and organise the original receipts. Then, you can prepare corresponding accounting vouchers. These steps are time-consuming if they are followed in traditional ways, especially for a beginner. Therefore, a professional reporting tool can offer you some help. FineReport supports data connection from different systems, making it easier for you to collect financial data while ensuring the accuracy of the data. Besides, FineReport’s automatic report function can realise real-time data updating, which saves the time of manual modification and improves your work efficiency.
Step 3: Design a report and visualise financial data
After data collection, it is time to display the data in a financial report. Traditionally, financial professionals are accustomed to making reports in Excel. There is no doubt that Excel is a very practical and convenient tool for a new company to do financial reporting. However, as the company develops, the volume of financial data will also grow rapidly. The traditional financial spreadsheet will become more complex, making it harder for people to analyse. Therefore, the company needs a reporting tool for help. FineReport is a professional reporting tool specialising in financial solutions. It offers different templates and samples not only for financial statements but also for financial analysis. There are three built-in financial statement templates for you to apply, saving time and effort.
Different financial dashboards in FineReport help visualise financial data to improve the efficiency of financial analysis. The Excel-like design of FineReport is very easy to use. After data collection, you can design the layout and drag and drop to generate reports. Dashboards can display key indicators more intuitively, making it easy for managers to find problems in time and adjust decisions.
Why Does a Company Need Financial Reports?
After the introduction above, you should have a better understanding of the definition of financial reports and the steps of creating them. But why does a company need financial reports? What can financial reports provide for different people? Let’s discuss the importance of financial reports for a company and the benefits of financial analysis reports for different groups, including the executives, the employees, the stockholders, the investors, and the creditors.
The Importance for an Enterprise
On the one hand, an enterprise needs financial reports to comprehensively measure the health of its financial position and obtain insights for future development. Through financial reporting, all the activities in the given time can be systematically recorded, and the results of these activities can also be clearly evaluated. Therefore, the enterprise can make predictions accordingly.
On the other hand, regular financial reports have some external advantages. Well-structured financial reports can display the company’s strength and its long-term stability for its cooperation partners as well as clients. As a result, the enterprise will gain more trust from them and establish long-term cooperation relationships.
For its executives
Financial reports help executives quickly discover the problems existing in the business operations and then adjust decisions. For example, suppose there are no structured cash flow statements. It will be hard for the executives to clearly remember a large number of different sources and uses of the cash, not to mention the net increase or decrease in cash and cash equivalents. However, if there are financial reports with visualised data, it will take less time for the executives to find out what is wrong and then readjust strategies to ensure the healthy development of the enterprise.
Conclusion
Keeping these concepts and skills in mind, you can successfully make a satisfactory financial report. If you want to save energy and improve efficiency, FineReport is a good option.
The article is contributed by Fanruan (Malaysia) Sdn Bhd
