Proving Your Business Viability Through Four Essential Financial Reports
Proving your ongoing viability is crucial in scaling a successful business to the next level. Whether applying for government subsidies, taking out a business loan or seeking investor support, you need robust financial evidence with the right financial reports to demonstrate your company’s stability and growth potential.
Why Financial Reports Matter
You need to present compelling financial data to substantiate your business’s current and future prospects. Lenders, investors, and government bodies want assurance that your business is viable and capable of delivering returns, which comes from having detailed and accurate financial reports.
Key Financial Reports for Business Growth
Here are the four essential financial reports you need to demonstrate your business’s viability and drive future growth:
1: Financial Statements
These include:
- Profit and Loss Statement (P&L): This report details your income and expenditures, which is crucial for assessing profitability.
- Balance Sheet: This snapshot provides an overview of your assets, liabilities, and equity at a specific point in time. The Balance Sheet indicates the strength of the business and gives a strong indication of a business’s potential to weather any financial storms that may face the business.
- Cashflow Statement: This shows your current cashflow position, aiding in effective spending and cost management.
2: Business Plan
Your business plan outlines your company’s goals, strategies, and financial projections. This document is a roadmap for your business’s future and is a critical tool for engaging with investors and stakeholders.
3: Budgeted Sales and Expenditure Forecasts
- Sales Forecasts: These projections estimate future sales based on historical data and known market and trading conditions, helping you anticipate potential growth and plan accordingly.
- Budgeted Expenditure Forecasts: These projections estimate future expenditure based on historical data and future sales projections, helping you plan for anticipated growth and budget accordingly.
4: Cashflow Forecasts
This report estimates your business’s cash inflows and outflows over a certain period. Maintaining a positive cashflow position (where cash inflows exceed outflows) is essential for operational stability and growth.
The Importance of Accurate Financial Data
Accurate financial data is essential for securing investment and your internal strategic planning and decision-making. By staying on top of your financial performance, you can better manage your business’s targets, budgets, and overall financial health.
Partner with Sharp Accounting for Expert Financial Reporting
Having precise and comprehensive financial reports is key to demonstrating your business’s viability and planning for growth. As your trusted advisors, we can assist you in creating a detailed business plan, revising your strategy, and producing all necessary financial statements.
Contact us to discuss how we can support your business with expert financial reporting and help you achieve your growth objectives.
The Essential SME Checklist for Growth + Profitability
Click here to download our Essential SME Checklist for Growth + Profitability; your roadmap to amplifying profitability and unlocking growth potential for SME businesses.
Sign up for the Sharp Accounting newsletter and get expert insights delivered straight to your inbox.
