Unlike an external report, which may be prepared for auditors, funders, or other external parties, an internal report is created for your company to communicate the success of initiatives or projects within specific business areas. Internal reports track the progress or status of tasks allocated to members of your team, which helps determine how productive corporate procedures have been.
The goal of this kind of report is to provide management, decision-makers, and the C-suite with all the information they need to make informed strategic decisions.
Why is it beneficial to conduct internal management reports?
It's useful to compile management reports for a number of reasons. For one, they give a great sense of what's happening in your business based on actual data. This helps you to:
Determine which direction to take your business in
Seize opportunities
Make better decisions
Budget and forecast
Evaluate your performance
Improve intra-company communication
Reduce risks
Improve efficiency
Demonstrate accountability to stakeholders
Pro tip 💡: Learn more about the benefits of management reporting in our guide.
What information should your internal report contain?
While different organizations will have different KPIs they focus on, there are certain elements that you will typically find in an internal management report, namely:
Comparisons of P&L variances: to ascertain whether you are under- or over-spending
A segmented P&L: to assess the profitability of each department
Cost of sales: to assess how much you are spending on the production of products
Your cash position: to manage liquidity and ensure you are sticking to your budget
Comparisons between assets and debts: to manage your debts and monitor your business's financial health
According to a Deloitte survey, top management expects the finance function's role to evolve from providing pure financial information to providing insight based on the appropriate gathering and analysis of credible internal and external finance and business information.
Finding the time or resources to make these reports
Although there are several reasons to conduct management reports, many businesses may be reluctant to do so because of the thought of spending hours putting these reports together. It doesn't have to be a labor-intensive activity, though. There are numerous tools available to help you generate internal management reports in no time. Here are a few options:
Cloud accounting software - to speed up data collection and integration
Business Intelligence (BI) tools - to create dynamic dashboards in real-time
Reporting software - to generate beautiful and professional-looking reports that can be customized to each client's needs or generated as repeatable templates
Automated reporting tools - to schedule and generate reports at predefined intervals
Collaborative tools - to facilitate real-time collaboration with team members so you can resolve issues and share insights while creating reports
Pro tip 💡: Syft Analytics' Live View feature allows you to analyze management reports alongside your team and share comments on them in real-time.
Start reporting today
Ready to create beautiful and professional internal management reports? Why not give Syft Analytics a try? Get started with a free trial today.