In the world of business finance, it is crucial to clarify the facts and provide accurate assessments and overviews for investors, shareholders, and even employees. One of the most common channels for companies to provide financial performance transparency in accounting reporting. As a result, you have to prepare proper accounting reports.

This article starts with the accounting report’s definition and meaning and then lists the company’s three most important accounting reports. And also, an effective method for generating accounting reports by using professional reporting tool will be introduced.

What are Accounting Reports?

Accounting reports are powerful tools that can provide you with periodic statements on a company’s financial status within a specific time or period. They are compiled based on financial information derived from business accounting records. You can check the company’s finance’s health and infer insights about your business from accounting reports.

An accounting report should be quantitative as accounting itself is all about numbers. Also, accounting reporting has financial nature. Usually, some people consider accounting reports to be equivalent to financial statements. Last but not least, accounting reports are very important in terms of management, law, evaluation, and many other aspects. Therefore, they must be readable, clear and accurate.

Accounting Report Examples: 4 Types of Accounting Reports

An accounting report can be brief or comprehensive or customized for a specific purpose.

Financial accounting reports are to reveal important information to the outside. You are telling them how much money your company made or lost. Here are the three most common accounting reports that you should know about.

Note: All the financial accounting reports templates shown in the article is made by reporting tool FineReport. FineReport is a leading reporting tool in the industry, capable of quickly and easily creating all kinds of complex reports. In FineReport, there are many built-in accounting report templates that can be applied with just one click.

Income statement

Income statements tell you how profitable your business was during a given reporting period. A typical income statement contains three parts: total revenue, total expenses, and net income.

The income statement starts from the total income received in a certain period and then subtracts expenses to obtain profit and loss. The idea is to get an overview of everything that influences your bottom line. 

As a general rule, the reporting period covers yearly or quarterly.

Cash flow statement

The cash flow statement, or the statement of cash flows, summarizes the cash and cash equivalents that moved in and out of a company. It is the most accurate source of information regarding the cash generation ability of your business.

The cash flow statement’s primary sources are cash from operating activities, investing activities, and financing activities.

As a bridge connecting the income statement and balance sheet, cash flow statements are a mandatory part of a company’s financial reports.

Balance sheet

A balance sheet displays a company’s assets, liabilities, and equity balances as of the balance sheet date. This report is used to evaluate the liquidity and financial reserves of a business. 

The balance sheet is based on the fundamental equation: Assets = Liabilities + Equity. As such, a standard company balance sheet is divided into two sides: assets on the left and financing on the right–which itself has two parts: liabilities and ownership equity.

General ledger

The general ledger classifies and summarizes all transactions and is composed of each account required in the account book. In the general ledger, debit and credit are used to show the balance between accounts. Generally, companies use general ledger reports as the basis for accounting reports and financial statements.

Why Visualize Accounting Reports?

It is essential to track the financial status of a business and its evolution over time. Therefore, regardless of the size of the company, accounting reports are an important business element. They allow assessment of the current situation compared to the previous and/or forecast. For investors, financial institutions, or tax authorities, a readable report is also extremely important.

When digital technology is more and more widely used in business, managers are faced with an increasing amount of data. They must quickly extract valid information from massive amounts of data and make reasonable decisions. Visualizing all this information by creating and managing accounting reports is a way to deal with this data overload and improve the quality of decision-making.

In addition, visual financial statements are a powerful way to communicate all your work to anyone in an easy-to-understand and easy-to-access way. It will help you discover potential problems or pain points and translate them better to the outside world.

How to Generate Accounting Reports Effectively

Now we are sure that companies are responsible for providing three main accounting reports: the cash flow statement, income statement, and balance sheet. But there is a catch: How to create these accounting reports in an efficient way?

If the data amount is tiny, you can use Excel to make accounting statements. But please keep in mind that Excel has limited processing performance for large amounts of data, and it is hard to update in a real-time manner.

When it involves a large volume of data, professional software such as FineReport is definitely a better choice. 

Anyone Can Build Impressive Reports Within 10 Minutes

Within only three steps, you can create an accounting report by FineReport.

01 Connect to data sources.

You can conveniently integrate data from different databases, build and customize reports via the excel-like interface without messy scripting or coding. FineReport adopts a drag-and-drop operation and an excel-like interface so that every accountant can get started smoothly. 

02 Use the template and put in the data.

You can directly apply pre-designed templates without having to repeat the work again and again. To bind data columns to cells, you simply need to drag each data column from the datasets and drop them in the corresponding cells. FineReport provides useful functions covering almost all the scenarios in work. You can use them directly or customize your own functions.

03 Design the format and style.

To polish up your report, you can modify the style or add parameters such as “year” and “region” to make it more interactive and attractive.

Raw data is unable to speak, and it is always not easy to find accurate conclusions quickly from messy financial data. Luckily, I have provided a more detailed tutorial on design logic and hands-on procedures. If interested, You can read 3 Steps to an Effective Financial Statement Analysis for more information.

Report automation frees you from repetitive tasks

FineReport helps automate the process of generating accounting reports and dashboards. With various built-in templates in Finereport, you can directly apply them without any additional effort.

Below I use the FineReport built-in template to create a profit center dashboard.

Timing scheduled function allows you to quickly and easily set up daily, monthly, quarterly, annual reports, and other tasks without repetitive work. The latest financial statements can be created automatically based on real-time data and regularly pushed to your manager by email or text message.

Meanwhile, it is easy to export or print the reports in various formats, such as Excel, PDF, PNG, etc., or schedule reports sending via email.

The following are financial dashboards made with FineReport. The three design modes in FineReport can satisfy all scenario needs in the enterprise, no matter periodic reports, complex reports, or dashboards.

If you are interested, why not download and have an excellent visualization trial?

Conclusion

Accounting reports allow the reveal of accounting information in an easily readable format. The most basic accounting reports are income statements, cash flow statements, and balance sheets.

Making these reports is not easy for novices and often tedious even for experienced accountants. FineReport provides an automated solution to the complex process of generating accounting reports and dashboards.