6 Key Financial Documents Any Small Business Needs
Drawing up the right financial documents matters to your small business’ success more than you think they do. They can give you a clear view of your financial health and can help you make sound decisions based on the numbers.
Below are the six most useful financial documents that you can benefit from:
- Income statement- This shows your revenue and expenses and indicates if your business is profitable.
- Cash flow statement- This documents how cash is coming in and going out of your business. Most importantly, this shows which parts of your business are generating the most cash and which ones are spending the most cash. It can be really helpful when creating upcoming budgets.
- Balance sheet- This shows if your assets balance with your liabilities. If you have more liabilities than assets, you’re losing money and must reevaluate.
- Accounts receivable aging report- This is a list of overdue customer invoices. It covers how late the payment is and how to contact the client for collection.
- Budget report- This compares the actual results of your business with a pre-established budget. It is used to determine how much funds each area of the business is given and how well they use the funds to achieve the goals of your business.
- Business plan- This maps out where your business is, where you want it to go, and how you plan to get there.
If you need help generating or understanding these financial documents, simply get in touch with us. Our reliable team can explain these in plain English so its easy-to-understand.