This post will discuss what is often titled a Flash Report. My last post was about Operational Dashboards versus Financial Dashboards. It may have sounded as if I don not like financial data due to a preference for an operational dashboard. Nothing could be farther from the truth; I love financial data and converting it into information to base decisions.
A flash report is a concise high level view of the financial results of the month that is produced soon after the end of the month, usually before the results are final. Since these are not the final results, but a solid look at how what financial results will be, information needs to be at a summary level and quick to produce as well as in a format that is quickly consumed by the managers. Graphs and short clear variance analysis are integral to a successful flash report. I suggest that if a flash report is more than two pages it is too long. Also, the format of the report should remain consistent each month. This will allow the manager to know where to look on the report for the information they want. The term "Flash" indicates speed and this report is intended to be consumed quickly.
Each company, or division, will have differnt things on their flash report because different things drive their business. But, similar to dashboards, there will be key themes across all flash reports regarding what will be included. What most likely will be different from the dashboard is the limited, or lack of, operational data. This is a financial report.
A very high level Income Statement with variances to budget or forecast should be the lead schedule. Take heed of the words "high level" as it is important to show only the most important line items. Presenting a full financial statement will be too much information for the manager to quickly consume and take too much time to prepare. Revenue and gross margin may need to be presented by product line or by region as appropriate. Only the major expense items are broken out and the remaining expenses are included as "all other." Since the report is prepared before the books are closed for the month, taxes are normally excluded from a flash report.
Other information often included is Bookings and Backlog, head count, cash balance and maybe accounts receivable. Not all companies include all these items because the information is not overly important to the business, the information is not available quickly enough or takes too much effort to put together.
While actual results for the month are nice to know, it is the variances that indicate what is happening in the business. This is true for all financial reporting. Commentary explaining the variances will show the manager what she needs to know to understand what happened in the month and to make changes to improve future performance. Flash Report commentary is often in bullet format, again for quick consumption
When putting a Flash Report together, keep the report short, focused on key items and easy to produce. By doing this and providing solid variance explanations, the manager will have good quick sense of what happened and be able to research and make adjustments.
A flash report is a concise high level view of the financial results of the month that is produced soon after the end of the month, usually before the results are final. Since these are not the final results, but a solid look at how what financial results will be, information needs to be at a summary level and quick to produce as well as in a format that is quickly consumed by the managers. Graphs and short clear variance analysis are integral to a successful flash report. I suggest that if a flash report is more than two pages it is too long. Also, the format of the report should remain consistent each month. This will allow the manager to know where to look on the report for the information they want. The term "Flash" indicates speed and this report is intended to be consumed quickly.
Each company, or division, will have differnt things on their flash report because different things drive their business. But, similar to dashboards, there will be key themes across all flash reports regarding what will be included. What most likely will be different from the dashboard is the limited, or lack of, operational data. This is a financial report.
A very high level Income Statement with variances to budget or forecast should be the lead schedule. Take heed of the words "high level" as it is important to show only the most important line items. Presenting a full financial statement will be too much information for the manager to quickly consume and take too much time to prepare. Revenue and gross margin may need to be presented by product line or by region as appropriate. Only the major expense items are broken out and the remaining expenses are included as "all other." Since the report is prepared before the books are closed for the month, taxes are normally excluded from a flash report.
Other information often included is Bookings and Backlog, head count, cash balance and maybe accounts receivable. Not all companies include all these items because the information is not overly important to the business, the information is not available quickly enough or takes too much effort to put together.
While actual results for the month are nice to know, it is the variances that indicate what is happening in the business. This is true for all financial reporting. Commentary explaining the variances will show the manager what she needs to know to understand what happened in the month and to make changes to improve future performance. Flash Report commentary is often in bullet format, again for quick consumption
When putting a Flash Report together, keep the report short, focused on key items and easy to produce. By doing this and providing solid variance explanations, the manager will have good quick sense of what happened and be able to research and make adjustments.
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