Tag Archives | reporting

The Importance of Using GAAP Financial Statements

Use GAAP Financials, Using GAAP Financial Statements, GAAP Financial StatementsI have written about this in the past, yet it is an ongoing subject that we deal with business owners day after day… A client recently asked me why we (The Strategic CFO) were insisting on generating the clients financial statements on an accrual basis and per GAAP.

He insisted that cash basis was fine and that we were just creating a lot of busy work.

He also stated that he did not care or need the balance sheet, just the income statement.

Today, we’re talking about the importance of using GAAP financial statements.

GAAP Financial Statements

Our firm did not invent GAAP financial statements.

GAAP means Generally Accepted Accounting Principles.

These principles have evolved over time as we get smarter and more advanced.

The main principle behind GAAP financials is to generate a set of financial statements that represent the most accurate picture about your company. They should be comparable, not misleading and clear so a third party can understand.

So the uniform application of GAAP to business transactions would most clearly represent a true picture of your business.

The Importance of Using GAAP Financial Statements

There are several reasons companies should be using GAAP financial statements.

First, public companies and certain loan documents require GAAP financial statements. We recommend that all private businesses also use GAAP financials as a best practice so you can have the best information to run your business.

Second, by not having your financial statements per GAAP (which uses accrual based accounting), you are basically 60-90 days behind your business.

Use GAAP Financials, Using GAAP Financial Statements, GAAP Financial Statements

Running Behind Your Business without GAAP

Let’s look at an example of a manufacturing facility.

Someone in the manufacturing facility orders $50,000 worth of raw material, but you have not yet received an invoice from the vendor.

The vendor takes 30 days to generate an invoice because they have an inefficient accounting department.

The invoice gets mailed, taking 1 week to get to you.

Your staff person got the mail and did not enter the invoice in the system for a week.

Then because you did not review your aged payables until the end of the month, you are likely to be 60 days behind your business. You will not have the liability section reflecting the payable for this example until much later.

That means your balance sheet is not accurate.

Plus, you may not have that payable in your cash forecast for payment.

This example is one transaction, but it adds up when you consider all the transactions in your business.

You will be 60 to 90 days behind your business by not keeping your books on accrual basis.


Don’t let something as simple as not having your financial statements per GAAP take value from you! Learn about 10 other destroyers that could be taking value away from your company.

Download the Top 10 Destroyers of Value


Accurate Reports on Your Business

As a business leader, you want the most accurate reports on your business on a timely basis so you can make business decisions.

Your income statement, balance sheet, and statement of cash flow paints the picture of the recent historical performance of your business.

You need to monitor the trends so that you can make business decisions timely.

Critical for Growth

We see it over and over again… A good business is mismanaged because the CEO or entrepreneur does not want to spend the money or take the time to understand his financials or keep them per GAAP. Eventually, they are upside down on working capital and run out of cash. This is especially true in a high growth environment.

Reasons for Using GAAP Financial Statements

If you have a small business of 3 employees with one legal entity and have sales of $800,000 per year with no plans for growth, no debt, no outside investors, then you can certainly keep your books on cash basis and ignore GAAP.

But if you grew beyond that and have a substantial business that you want to grow, or you have debt, our outside investors, then you seriously need to consider keeping your books and records on an accrual basis and per GAAP.

In short, why should you keep your books and records on an accrual basis and per GAAP?

  • Working Capital – Not having them per GAAP can lead to operational disaster
  • Outside Investors and Lenders will require them
  • Growth – If you are beyond a mom and pop shop, then these financials will be your key tool for growth
  • Value – From a valuation standpoint, GAAP financials add value

Why Use GAAP Financials

So to answer the question we started this blog with why use GAAP financials?

First, using these principles allow your business to be presented correctly to third parties.

Then, you need accrual based financials to properly run your business. Otherwise, you are 60-90 days behind running your business. It may be required by your lender.

Having your books kept per GAAP actually adds value to your business from a valuation perspective. While you are working on adding value, make sure there aren’t “destroyers” taking value from you. Download our Top 10 Destroyers of Value whitepaper and protect your company’s value.

Use GAAP Financials, Using GAAP Financial Statements, GAAP Financial Statements

Use GAAP Financials, Using GAAP Financial Statements, GAAP Financial Statements

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What Should Your Month End Reports Contain?

what should your month end reports containBack in the day, month end reports consisted of a income statement, balance sheet, and maybe a cash flow statement. These are the three statements that made up your financial statements for month end reporting. As technology advanced and people got smarter about tracking trends, analysis, and operations today, the month end report includes much more. In this week’s blog, I answer the question, what should your month end reports contain?.

We should not think of the month end report as just your financial statements. Just as the role of the accounting department and the role of the CFO continues to evolve, so should the month end report. The month end report should be a management report that captures key data that will be used to make decisions and drive the business. It should include much more than just your financial statements.

In today’s world, the CFO does so much more that count beans. They add real value to the company. Learn about the 5 Ways a CFO Adds Value.

What Should Your Month End Reports Contain?

The month end report should include the financial statements. But they should also include operational data, metrics, and dashboards that are both usable and meaningful. Remember, whatever data is provided should be used to make decisions.

In general, for a manufacturing facility your month end report might include the following:

I would argue that the above list is the bare minimum for month end reporting. Depending on your organization, you may have many other indicators that must be tracked at month end.

Having the right indicators will help you make better decisions and add real value to the firm. Access our 5 Ways a CFO Adds Value whitepaper to learn add value in 5 simple steps.

what should your month end reports contain“Analysis Paralysis”

Be careful though… Providing meaningful useful information at month end does not mean overkill with useless data. Time and time again I see businesses adopt dashboards and metrics, but they go to the other extreme and enter into analysis paralysis. What should your month end reports contain? Not so much that there is an overload of information that cannot be used effectively or at all.


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Example of Analysis Paralysis

Allow me to give you an example… If you manufacture valves, your revenue is $10 million per month, and your related EBITDA per month is $1.5 million, then does it really make sense to track an expense line item that is $500? I would argue no. It costs you more time and money to track that item individually. If you do track it, then having that data will not lead to big decisions that are meaningful. All expenses and revenue line items are important, but that does not mean you need to track and analyze every penny. If you are a huge company and have a very expensive system that does all this automatically, then good for you.

There is a famous quote that I have used before, “a small leak sinks great ships.” I truly believe that. We do not want to have a small expense item that over time is a problem. But this blog is intended for your standard monthly close reporting and assumes you have your business in order so that you capture and put a stop to those small leaks.

Efficiency

The month end report should not be a binder 4 inches thick. The ideal financial report at month end should be one that the executive team can review in one hour and get a good feel for where the company is and where it is going. This will vary from company to company. In general, the report should be detailed enough to capture the most important items to make decisions, but condense enough so the management team does not spend a full day reading a large binder. Again, this will vary company to company. Some CEOs want the large binder, and that’s fine. Follow your CEO’s request.

The CFO and the accounting department are responsible for gathering this data working hand in hand with the operations. That is why I preach that a good CFO is actually someone that has a very good understanding of the operation. The Controller should also be someone that understands the operation. Furthermore, the CFO and the Controller should understand both the operation and the operating metrics. The CFO must full understand and interpret the operating dashboards and metrics before this information is passed on to the CEO.

When a CFO has a good understanding of the entire business, they are able to be more effective in their role. Learn about the 5 Ways a CFO Adds Value to take your role to the next level.

In Summary

In summary, your month end report should capture more than just your financial statements. It should also capture the following:

  • Capture key operational data
  • Capture information that is useable to make meaningful decisions
  • Key metrics and dashboards for your business and industry
  • Keep it short and sweet so the executive team can review this report in an hour or less
  • Careful not to overanalyze

If you want to add more value to your company, creating a great month end report is a good start. Learn 5 other ways to add value as a CFO with our 5 Ways a CFO Adds Value whitepaper.

What Should Your Month End Reports Contain

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What Should Your Month End Reports Contain

9

Timely Close of the Financial Records

Timely close of the financial records – this is a topic every company needs to address. Whether you are a publicly traded or private company, the issue of closing the books is ongoing. Publicly traded companies usually have well established processes in place to meet the deadlines imposed on by the regulators. However, closely held businesses often struggle with this process. We see many clients that tell us it takes them weeks, if not months, to close the books and produce financial statements. This blog will discuss why it is important to close you accounting records as soon as possible. In addition, we will provide some tips on improving your financial close.

Timely Close of the Financial RecordsImportance of the Timely Close of the Financial Records

Why is it so important to close your books timely and generate financial statements? The executive team of the company must run the business, and there is no other way to run your business than to have timely and reliable financial statements.

I have met business owners that own a company with over $100 mm in revenue and no financial statements. They literally used a check book and online banking to check cash balances, pay down outstanding balances, etc. When I asked the business owner how he knows what his margins are and how he can run his business, his response was he has a“gut feeling”. I get that, and in a sector with high margins and strong cash flow, I can see where an owner gets confident about the amount of cash he pulls from the business monthly and stuffing his pockets. But that “gut feeling” will not help you when the market or economy turns. And it will one day.

A gut feeling cannot be measured or tracked. Fortunately, you can track your key performance indicators (KPIs.) Click here to discover your KPIs.

In a well run company, the decision makers must know how the business is performing by looking at the historical data. Historical data includes last month’s financials and even the trailing 12 months. With that information, the decision maker will apply his management skills and look at forecasts, then make executive decisions of what to do. The sooner the decision maker has the financial data, the quicker he can make a decision.

How to Close Your Books Sooner

How can you close your books sooner and produce financial reports? A delay in closing the accounting records and producing financial statements is very common. And sometimes, there are various causes for this.  It may be any one or several of the following:

How quick can you close the books? What is the right number of days to close the books? Well, it depends on many things. Certainly more than 10 days after the last day of the month is too long for me.


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I have always said that a well run company with the correct process and systems in place should be able to close the books any day of the month. Now with that said, the closer to the end of the month the more accurate the numbers will be because you limit the use of accruals to only a day or two. I would not suggest that it is okay to close your books too early. But your business should be able to start the close process a day or two before the last day of the month and have financial statements by the 5th day of the following month.

If your financial records are delayed by days or even months, then it will be more difficult to make any decision. Start tracking your KPIs as you close your books more timely with our KPI Discovery Cheatsheet.

Tips to Close Your Books Timely

Every company should be working toward timely close of the financial records. The following includes some tips to close your books timely:

    • Establish an accounting calendar close that includes deadlines for turning in information from operations and accounting, firm deadlines for certain activities
    • Hold people accountable in operations and accounting to meet the deadlines
  • Use accruals for revenue and expenses, no need to wait on actual invoices
  • Reliable accounting system
  • Hire the right people
  • Written process and procedures in the accounting department
  • Always include at least one day after the preparation of the financial statements for analysis

There is simply no excuse to delay the accounting close and generation of financial statements. Having the financial reports completed timely and analyzed before they are turned into the decision makers of the business will make your company a much better company.

When you close your financial records or books in a timely manner, you are able to make better decisions. In addition, monitoring your key performance indicators will help you to make better decisions. Need help discovering the KPIs you should be monitoring? Access our KPI Discovery Cheatsheet and start tracking your KPIs today!

Timely Close of the Financial Records

Timely Close of the Financial Records

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Why Use a 13-Week Cash Flow Report as a Management Tool?

Why use a 13-Week Cash Flow Report as a management tool? Cash is king! This applies to any and all companies. No matter the size or industry, cash and cash flow are critical to any operation. Yes, some companies have access to lines of credit and other forms of financing, but that is debt that must be repaid at some point.

So if cash is so important, then why do not all companies use a rolling 13-week cash flow forecast?  We have had many clients over the years. And some, but not all, use a 13-week cash flow report as a management tool that is updated every week. Once the process is started, it is actually a fairly easy tool to keep updated.

Cash is critical to a company’s success. Click here to access our 25 Ways to Improve Cash Flow whitepaper and start improving cash flow today.

Establish a 13-Week Cash Flow Report

The first thing we do with every client is to make sure they establish a 13-week cash flow forecast if they do not already have one. And usually, the first thing we are told by someone at the client office is “our business is special, forecasting when we collect cash is almost impossible to predict”. I hear this way to often and you know, we have never failed at implementing a 13 week cash flow forecast.

13-Week Cash Flow Report as a Management ToolThe Purpose of the 13-Week Cash Flow Report as a Management Tool

The 13-week cash flow report is not meant to me an exact measure of what cash balance will be at the end of every week. On the contrary, it is a forecast. That means the actual results will be different from your forecast, especially in the later weeks. But what the cash flow forecast does tell you is your trend for ending cash balances. It actually does give you an estimate of what your cash balances will be. It is true that weeks 1,2 and 3 forecast are more accurate than weeks 11, 12 and 13.  But it does not take away that it provides some visibility as to where cash will end up.

The 13-week cash flow forecast is useful to a company that is financial distress and to a company that is flush with cash. That is because a company that is in financial distress must be able to determine what costs they need to cut in order to achieve a cash neutral position. A company that is cash rich, needs to know how flush they will be with cash to project things like capital expenditures or shareholder distributions. Either way, the company must have an idea of where they will be over the next 13 weeks. Why 13 weeks? Because that captures an entire 3 months, one full quarter. Being able to have an idea of where you want from a cash position in the next 3 months allows time for planning and decision making.

Do you need help putting together your 13-week cash flow report? Access our template and how to use it (and so much more) in our SCFO Lab. Learn more about the SCFO Lab here.

Cash Collections

It is interesting how many times we have implemented a 13 week cash flow forecast, then we look into why the cash actually collected is way off in weeks 1,2 and 3. Then we dig and find out that the actual cash collection process is poor or non-existent.

Case Study

I was part of a Chapter 11 bankruptcy process a couple years ago. The first thing we did was implement a 13 week cash flow forecast. This is something any CRO would do. When asked about cash collections, the CEO told me that the sales team (7 people) handle collections with their respective client relationships. When we were way off on week 1 and 2, I asked the sales people why we are off?  What are they doing to follow up on late accounts receivable (A/R)?  The response from everyone on the sales team was that they do not handle calling to collect invoices and outstanding A/R.  They stated that the accountant makes those calls and follows up with old A/R.  When I asked the accountant, she said the sales guys collect old A/R.

No one was following up with collections of old A/R. I initiated a daily phone call with all the sales people and assigned clients to call on and follow up on old A/R. We started with daily calls. And we saw some progress, then we went to every other day, then weekly calls. Over then next 5 weeks the company collected $2.7 of $3.2 million dollars in old AR.

So How Do You Start Using a 13-Week Cash Flow Report?

Week 1,2,3….13

Create a template that has a direct method cash flow statement.

Cash In –         Cash from accounts receivable

Then list cash from work not invoiced yet (this would be in the outer weeks)

Cash Out–       Major lines of operating expenses

Payroll

Other

On a weekly basis, pull A/R and A/P from your accounting system. Then link the individual items to the line items in the cash flow forecast. Don’t forget payroll totals.

Include a section below operations for CAPEX activities and another section for Financing Activities.

End cash balance by week

Cumulative cash balances by week

Have one person in your accounting department responsible for updating the 13-week cash flow forecast weekly. Make sure you have a dedicated person/people follow up on collections.  Compare the forecast for each week to the actual cash collections and cash payments – note variances. Then adjust how you forecast.

It is that simple! This tool will buy you peace of mind and allow you to have insight on your cash trends. You need to know this no matter the size of your company or your industry. Do not get frustrated; your first 3-4 weeks are a learning process. Your forecast WILL be off. Make adjustments and understand your variances. Before you know it, you will have a good feel for what your cash trends are. If you are strapped for cash now, click here to access our 25 Ways to Improve Cash Flow whitepaper. Make a big impact on your company today with this simple checklist.

13-Week Cash Flow Report as a Management Tool
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2

Flash Reports Are a Game Changer

Flash Reports

When we talk to people who have sales or operations backgrounds, we quickly pick up on their hatred/dislike/disdain/etc. for accounting. We get it. Accounting can be boring, especially if it’s not used for management purposes. But when we talk with the management team either in our coaching workshops or our consulting practice, we always implement a flash report in their company. Why? Because it’s a management tool that should be used by every leader in an organization! Flash reports are a game changer when it comes to leading a company financially. In fact, I will be bold enough to say every company should be using a flash report to make any decision in the company. (Keep in mind, we are not recommending that this is the only tool you should use to make decisions.)

What is a Flash Report?

First, what is a flash report? We have defined Flash Reports (or financial dashboard report) as “periodic snapshot(s) of key financial and operational data.” It measures three factors in your company, that include liquidity, productivity, and profitability. Unlike what sales and operational leaders typically think about accounting, this tool is supposed to guide them with the numbers. In addition, the numbers from flash reports aren’t going to be a 100% accurate. But if they are 80-90% accurate, then they are accurate enough for the management to make decisions.

Flash reports have changed how financial leaders lead the rest of their team. It’s just one of the ways that you could be more effective in your role. If you want to learn more, click here to access our free 7 Habits of Highly Effective CFOs.

Flash ReportsHow a Flash Report Changes the Role of the Financial Leader

Stereotypically, an accountant or someone with accounting/finance background is a numbers cruncher. They want to look at all of the numbers and want the management team to also get excited about every number. In reality, there is not enough time to focus on every number. Instead, you should be looking specifically at 6-8 numbers that drive your business. We call them your key performance indicators or KPIs. Anyone in your company should be able to look at your flash report (a one-page report) to assess what the KPIs are doing.

Not just anyone in accounting cannot create a flash report… It would quickly get out of control because there are so many angles, numbers, and perspectives that you could interpret the data from. Unfortunately, there is not enough time in the day to look at all the data. It would take forever for management to look at all the information and make a decision. We know there is an art to be a financial leader. There is also an art to creating flash reports or dashboard reports. The goal is for the flash report to be prepared and completed within 30 minutes. It should cover a week’s data for the company to quickly pivot or adjust if need be.

How to Prepare a Flash Report

For a flash report to be a game changer, you have to set it up correctly the first time. Prepare a flash report by producing the following sections in consecutive order.

Productivity

First, the financial leader (CFO/Controller) needs to meet the owner or executive leaders to come up with some metrics for the productivity section. Both finance and operations need to be involved in this conversation because this section is what sets up the next two sections. You will know you have succeed when you have an indication of the key performance metrics of your company. These metrics also connect operations to the financial performance of the company. It’s an accountability partner. If you are looking to improve productivity in your company, then click here to read about our insights on how to do it.

Remove some of the barriers between departments in your company to increase your value to the company. To learn more how you can be effective, click here to download our 7 Habits of Highly Effective CFOs.

Liquidity

When you prepare a flash report, this section is where your CEO is going to look at first. It’s the pulse of the company because it tells them how much the company is generating cash (or not generating cash). The cash situation is often the first issue we discuss with consulting clients. Unfortunately, we find a lot of companies are not able to tell you if they have enough money to pay the bills and keep the lights on. Remember, cash is king.

Profitability

This is going to be accounting’s favorite section because it deals with what they focus on! The reason why you need to produce it last is because it needs to connect with the rest of the business. It should give management a rough idea of how much money they made during a given period. You will need to have a good understanding of your accruals if you are going to provide profitability in as part of the flash report.

Remember, timeliness is more important than accuracy in this flash report. There’s a reason why it’s called a flash report! Furthermore, management needs to focus on how the trends change over time.

Flash Reports Are a Game Changer

Flash reports are a game changer in the business world because it pushes companies to break down barriers in the business. We frequently say that CFOs and the financial leader of a company should walk around the office/warehouse and talk with sales managers, warehouse workers, operations managers, etc. Financial leaders need to get out of accounting so that they can lead financially. But the same goes for operations and sales persons. It may not be exciting, but they need to visit accounting.

This past week, we hosted a live webinar for those operations employees that were promoted to a P&L Leader. They were great at their job, but now they manage an entire department/division/etc. So, we touched on how they should be using flash reports as they manage their operation. Anyone in your company can be a financial leader. You just have to have the right tools, and flash reports are a great way to start.

Tips for Monitoring Your Business

Your flash report should be a living, breathing document that your business uses. As a result, we wanted to share some time for monitoring your business as you move forward with your flash report. Include the 3 most recent historical periods in addition to the current period in the flash report. This allows you to analyze trends in the same document. Have your entire management team agree to commit to the document. You may need to adjust it as time goes on, and that’s okay. Review weekly with your management. During these meetings, it may be useful to convert the sections into graphs so that the non-accountants can see what the numbers are communicating.

Producing a flash report is just one of many ways to be highly effective as a financial leader. Download the free 7 Habits of Highly Effective CFOs to find out how you can become a more valuable financial leader. Let your flash reports be a game changer in your business!

Flash Reports Are a Game Changer

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Flash Reports Are a Game Changer

2

What is Microsoft Dynamics?

See Also:
How Do You Know When It is Time to Buy New Software
How to Choose New Software
Microsoft Dynamics Great Plains Functionalities
How to Choose a Software Dealer
How to Obtain a Microsoft Dynamics Licensing Agreement

Microsoft Dynamics

Microsoft Dynamics is the brand name of a group of business management solutions from Microsoft. These solutions provide functionality that address business needs in the following areas:

Companies of various sizes have successfully implemented these solutions in most industries. Furthermore, the strong points of the Dynamics product line lie in deep functionality in the above mentioned areas, ease of use and the full integration with the other Microsoft products. Good examples include the following:

  • The very familiar ‘look and feel’ from Microsoft Office
  • The usage the business intelligence functionality of Microsoft SQL 2005
  • The usage of Windows Workflow Foundation (which comes with the latest version of Windows)

Microsoft Dynamics Functionality

Business intelligence functionality is very useful for reporting and analysis of trends in the performance of an organization. Most of this functionality is tightly integrated with Microsoft Excel because it is the main tool financial analysts, controllers and CFO’s alike use.

Workflow functionality also helps organizations cut back on the paperwork and paper handling resulting in very fast and efficient processes. Good examples include the following:

  • Expense claims
  • Timesheets
  • Purchase order approvals

Dynamics Products

The Dynamics products Microsoft offers that at least cover the business needs in the area of Financial Management as well as Business Intelligence and Reporting include the following:

Each of the products offers additional functionality in one or more of the following areas: Supply Chain Management, Project Management, Manufacturing, and Human Resources Management. Dependent on what flavor of the product has been licensed, the customer will receive a smaller of larger subset of functionality offered by the product. In addition, each product will have functionality available that will need to be licenses separately if the customer has needs that would require that functionality.

As Microsoft sells the Dynamics products through their partners, it’s important to make sure you select a partner that has not only the requisite product knowledge but also has ample resources with skills in financial accounting, business processes and information technology and has a track record of successfully delivering implementation projects on time and on budget. They will also help an organization determine what modules of functionality are needed to solve their business needs.

If you want to create the roadmap for your company’s success, then access our free Internal Analysis whitepaper.

microsoft dynamics
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microsoft dynamics

 

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Pro-Forma Financial Statements

See Also:
Proforma Earnings
Balance Sheet
Cash Flow Statement
Free Cash Flow
Variance Analysis

Pro-Forma Financial Statements Definition

In accounting, pro-forma financial statements are hypothetical financial reports that show either forecasts of or alterations to actual financial statements. Pro-forma financial statements show the financial statements of a company in a hypothetical scenario that has not yet been realized or that represents a modification of the actual financial statements. Furthermore, pro-forma reporting is useful for showing what a proposed company would look like or for removing unusual or nonrecurring items from a financial report.

What is Pro-Forma?

What is pro-forma? In Latin, pro forma means for the sake of form. Additionally, pro-forma projections or pro forma reports are simply modified versions of actual financial statements that are made for the sake of showing what these documents would look like under certain hypothetical scenarios.

For example, if an entrepreneur has an idea for a company, and he wants to pitch the idea to potential investors, then he may want to draw up pro forma financial statements to show the potential investors what the company would look like once it’s up and running. In this case, the entrepreneur would create pro forma projections of the various financial statements and present them to the investors.

Or if a company incurs a major one-time cost that is not related to regular business operations, the company may want to show investors what the financial statements would look like without the affects of that major one-time cost. In this case, the company would include pro forma financial statements in its annual report.

Pro-Forma Financial Statement Example

Below is a very simple example of a pro forma income statement. Assume the company underwent a massive corporate restructuring that was very expensive. According to accounting regulations, the company has to include that restructuring charge on its income statement. Because the restructuring charge was so big, it wiped out the company’s income and the company showed a loss for that period.

However, this restructuring charge is a one-time extraordinary item, and is not part of the company’s normal business operations. So, in order to show investors and other interested parties what the company’s income statement would have looked like without that one-time restructuring charge, the company included a proforma version of the income statement in its annual report.

You will see the difference between the original income statement and the pro-forma income statement below. Then notice that removing the one-time restructuring charge turns the company’s loss into a profit. As you can see, the company may want investors and other financial statement readers to see the pro forma financial statement to understand why the company’s regular financial statement showed that the company took a loss during that period.

Regular Income Statement
Revenue                              $500,000
Cost of Goods Sold                    250,000
Restructuring Charge                  300,000
Interest Income                        50,000
Interest Expense                       25,000

Net Income (Loss)                    ($25,000)

Pro Forma Income Statement
Revenue                              $500,000
Cost of Goods Sold                    250,000
Interest Income                        50,000
Interest Expense                       25,000
Net Income (Loss)                    $275,000

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Pro-Forma Financial Statements

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Pro-Forma Financial Statements

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