Business Overview

Business Overview Reports provide a consolidated view of key financial and operational metrics, enabling users to assess the overall performance of the organisation. These reports highlight financial status, account balances, and summary insights to track key performance indicators such as profit, loss, revenue, equity, cash flow, and debt. In large enterprises, Business Overview Reports play a vital role in informed decision-making, strategic planning, and forecasting. In addition, these reports assist in communicating the financial status of the organisation to investors and stakeholders. Let us see the reports found under Business Overview in the following sections:

Profit and Loss

The Profit and Loss report provides a summary of operating and non-operating income and expenses, as well as the net profit or loss over a selected period. It offers clear insight into financial performance, helping stakeholders evaluate profitability, monitor cost efficiency, and make informed business decisions. In large enterprises, the Profit and Loss report facilitates a comprehensive view of whether profit or loss is incurred during the period.

To generate the Profit and Loss report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select the Profit and Loss report listed under the Business Overview.
• The Profit and Loss Report will be generated for the current month by default.

Users can customise the report by applying filters, and view the report in both Table and Chart View.

Profit and Loss (Schedule III)

Schedule III outlines the prescribed format for the preparation and presentation of financial statements in accordance with the Companies Act. It ensures uniformity, transparency, and regulatory compliance in the reporting of the Profit and Loss Statement.

The Profit and Loss Report (Schedule III) presents a structured summary of income and expenses in accordance with Schedule III of the Companies Act. It provides a standardised view of financial performance for the reporting period, ensuring regulatory compliance and facilitating transparent financial analysis.

To generate the Profit and Loss (Schedule III) report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Profit and Loss (Schedule III) report listed under the Business Overview.
• The Profit and Loss (Schedule III) report will be generated for the current month by default.

Horizontal Profit and Loss

The Horizontal Profit and Loss Report presents income and expenses side by side across multiple periods, enabling easy comparison and trend analysis. This format helps identify performance changes over time and support informed financial decision-making.

To generate the Horizontal Profit and Loss report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Horizontal Profit and Loss report listed under the Business Overview.
• The Horizontal Profit and Loss report will be generated for the current month by default.

Cash Flow Statement

The Cash Flow Statement provides a detailed view of cash inflows and outflows during a specific period. It classifies cash movements into operating, investing, and financing activities, helping stakeholders assess liquidity, financial stability, and the organisation’s ability to generate cash.

To generate the Cash Flow Statement report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Cash Flow Statement report listed under the Business Overview.
• The Cash Flow Statement report will be generated for the current month by default.

Balance Sheet

The Balance Sheet presents the organisation’s financial position at a specific point in time. It summarises assets, liabilities, and equity, providing insight into financial strength, liquidity, and capital structure. It displays the total amount in each account.

To generate the Balance Sheet report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Balance Sheet report listed under the Business Overview.
• The Balance Sheet report will be generated till today by default.

Horizontal Balance Sheet

The Horizontal Balance Sheet presents assets, liabilities, and equity side by side across multiple periods, enabling easy comparison and trend analysis. This format helps assess changes in financial position over time and supports more effective financial evaluation and decision-making.

To generate the Horizontal Balance Sheet report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Horizontal Balance Sheet report listed under the Business Overview.
• The Horizontal Balance Sheet report will be generated.

Balance Sheet (Schedule III)

Schedule III outlines the prescribed format and disclosure requirements for the preparation and presentation of financial statements in accordance with the Companies Act. It ensures uniformity, transparency, and regulatory compliance in the reporting of the Balance Sheet.

The Balance Sheet (Schedule III) presents the financial position of the company in the format prescribed under Schedule III of the Companies Act. It provides a structured classification of assets, liabilities, and equity, ensuring consistency, transparency, and compliance with statutory reporting requirements.

To generate the Balance Sheet (Schedule III) report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Balance Sheet (Schedule III) report listed under the Business Overview.
• The Balance Sheet (Schedule III) report will be generated.

Business Performance Ratios

Business Performance Ratios offer a comprehensive analysis of an organisation’s financial health and operational efficiency through a set of key performance indicators. These reports cover a wide range of ratios, including liquidity ratios that assess short-term financial stability, solvency ratios that evaluate long-term debt obligations, profitability ratios that measure the effectiveness in generating profit, and efficiency ratios that track how well resources are utilised. By presenting these insights in a structured and comparative manner, the reports help management identify strengths, pinpoint areas for improvement, monitor trends over time, and make informed strategic and operational decisions.

To generate the Business Performance Ratios report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Business Performance Ratios report listed under the Business Overview.
• The Business Performance Ratios report will be generated with Current Ratio by default.
• Select the required ratio from the dropdown list.

There are eight business performance ratios. Let us see each ratio in detail,

Current Ratio

The Current Ratio is a key liquidity metric that measures a company’s ability to meet its short-term obligations with its short-term assets. It is calculated by dividing current assets by current liabilities. A higher ratio indicates strong short-term financial health, while a lower ratio may signal potential liquidity issues. This ratio helps stakeholders assess the company’s ability to cover immediate debts and manage working capital effectively.

Gross Profit Ratio

The Gross Profit Ratio measures the proportion of revenue that exceeds the cost of goods sold (COGS), indicating how efficiently a company produces and sells its products. It is calculated by dividing gross profit by net sales and expressing it as a percentage. A higher ratio reflects strong production efficiency and pricing power, while a lower ratio may indicate rising costs or lower sales margins. This ratio helps management and stakeholders evaluate profitability at the core operational level and make informed decisions regarding pricing, cost control, and sales strategies.

Debt Ratio

The Debt Ratio measures the proportion of a company’s total assets that is financed through debt. It is calculated by dividing total liabilities by total assets. A higher debt ratio indicates greater financial leverage and potential risk, while a lower ratio suggests a more conservative capital structure with less reliance on borrowed funds. This ratio helps stakeholders assess the company’s financial stability, risk exposure, and ability to meet long-term obligations.

Net Profit Ratio

The Net Profit Ratio measures the percentage of net profit generated from total revenue, reflecting the overall profitability of a business after all expenses, taxes, and interest have been deducted. It is calculated by dividing net profit by net sales and expressing it as a percentage. A higher net profit ratio indicates strong cost control and efficient operations, while a lower ratio may point to rising expenses or declining revenue efficiency. This ratio helps stakeholders evaluate the company’s overall financial performance and its ability to generate profit from sales.

Acid Test Ratio

The Acid Test Ratio, also known as the Quick Ratio, measures a company’s ability to meet its short-term obligations using its most liquid assets, excluding inventory. It is calculated by dividing current assets (minus inventory) by current liabilities. A higher ratio indicates strong short-term financial health and the ability to pay off immediate liabilities without relying on inventory sales, while a lower ratio may signal potential liquidity issues. This ratio provides a more stringent assessment of a company’s liquidity than the current ratio and helps stakeholders evaluate its capacity to handle unexpected cash demands.

Receivables Turnover Ratio

The Receivables Turnover Ratio measures how efficiently a company collects its outstanding credit from customers during a specific period. It is calculated by dividing net credit sales by the average accounts receivable. A higher ratio indicates that the company is collecting receivables and managing credit effectively, while a lower ratio may suggest slow collections or potential issues with customer payments. This ratio helps stakeholders assess the efficiency of the company’s credit policies, cash flow management, and overall operational effectiveness.

Debt to Equity Ratio

The Debt to Equity Ratio measures the proportion of a company’s financing that comes from debt compared to shareholders’ equity. It is calculated by dividing total liabilities by total equity. A higher ratio indicates greater financial leverage and reliance on borrowed funds, which may increase financial risk, while a lower ratio suggests a more conservative capital structure with greater reliance on equity financing. This ratio helps stakeholders evaluate the company’s financial stability, risk exposure, and long-term solvency.

Operating Cost Ratio

The Operating Cost Ratio measures the proportion of a company’s operating expenses relative to its net sales, indicating how efficiently the business manages its day-to-day operations. It is calculated by dividing operating expenses by net sales and expressing it as a percentage. A lower ratio suggests better cost control and operational efficiency, while a higher ratio may indicate rising costs or inefficiencies in managing resources. This ratio helps stakeholders assess the company’s operational performance and make informed decisions to improve profitability.

Cash Book Summary

The Cash Book Summary provides a consolidated view of all cash and bank transactions over a specific period. It records receipts and payments in a chronological manner, allowing businesses to monitor cash inflows, outflows, and balances. This summary helps in tracking liquidity, ensuring accurate cash management, and supporting financial planning and reconciliation. The graph in the report will display your organisation’s current cash flow (depicted in green) alongside the forecasted cash flow (depicted in orange).

To generate the Cash Book Summary report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Cash Book Summary report listed under the Business Overview.
• The Cash Book Summary report will be generated for the current month by default.

Cash Flow Forecasting

The Cash Flow Forecasting report provides a detailed projection of a company’s expected cash inflows and outflows over a specified period. It tracks anticipated cash from operating, investing, and financing activities, enabling management to plan for liquidity needs, manage working capital effectively, and make informed strategic decisions. This report helps identify potential shortfalls or surpluses in advance, supporting proactive financial management and ensuring the organisation maintains adequate cash for its operations.

To generate the Cash Flow Forecasting report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Cash Flow Forecasting report listed under the Business Overview.
• The Cash Flow Forecasting report will be generated for the current year by default.

Customise Forecast Inputs

You can choose to generate your cash flow forecast report based on:

• The recurring profiles you want to include or exclude
• Assumptions

Include or Exclude Recurring Profiles

You can include or exclude the recurring profiles that are used to generate the cash flow forecasting report. Here’s how:

• Click Customise Forecast Inputs in the top left corner.
• Click Configure below the recurring profile you wish to include or exclude in your report.
• Select the profile you wish to include in your report from the pop-up that appears. If you don’t want to include it, simply deselect it.
• Click Add Items.
• Click Apply in the Customise Report section.

Your cash flow forecast report will now be generated based on the selected profiles.

Assumptions

In this section, you can add assumptions based on the anticipated transactions in your organisation. These assumptions will impact your cash flow report. Let us understand how assumptions work with the help of a scenario.

• Click Customise Forecast Inputs in the top left corner.
• Navigate to the Assumptions tab.
• Click + New Assumption.
• Enter the Name and Description for the assumption.
• Select the Account that will be credited or debited for the assumption.
• Enter the Amount and select an option from the dropdown before it, as the amount will be credited or debited based on your choice.
• Select the Mark this as a recurring assumption option if you want the assumption to repeat at regular intervals.
• Select the Assumption Period.
• If it is not a recurring assumption, select the date on which you want to consider the assumption.
• Select the Include this assumption in the cash flow forecast option if you want this assumption to be included in the report.
• Click Save.

Your cash flow forecast report will now be generated based on the assumptions.

Movement of Equity

The Movement of Equity report, also known as the Statement of Changes in Equity, tracks the changes in a company’s equity during a specific period. It details transactions such as share capital issuance, dividend payments, retained earnings, and other adjustments affecting shareholders’ equity. This report provides stakeholders with a clear understanding of how the company’s ownership interests have changed over time and supports transparent financial reporting and decision-making.

To generate the Movement of Equity report,

• Navigate to the Reports module listed in the left sidebar.
• In the Reports Center page, select Business Overview under Report Category.
• Select Movement of Equity report listed under the Business Overview.
• The Movement of Equity report will be generated for the current month by default.