You can't manage what you can't measure
Accountants typically spend a great deal of time in the compilation of financial statements for compliance purposes and for measuring the historical performance of a company. However, all of the data in the balance sheet and income statement is generated from historical information in the accounting system. To be useful in helping to improve the financial performance of a company, the raw financial data needs to be distilled into useful information so that it can be used in making strategic decisions. One way to do this is by calculating key performance indicators for significant performance categories: debt capacity, liquidity, asset utilization, and profitability.
For example, to track profitability, the gross profit percentage can be calculated and tracked over time. Similarly, to determine how effectively the assets of a company are being used to generate income, the return on assets can be computed. These are just two examples of many key performance indicators that can be generated to assess financial performance. Once the key performance indicators are computed and tracked over a period of time, the financial health of the company can be assessed and goals for improving financial performance can be established. Typically if these key performance indicators are generated at all, they are calculated manually using Excel® spreadsheets that can be very limited in flexibility, time consuming, and prone to human error.
Sage View has been introduced to help accountants and their clients overcome the limitations of manually generating key performance indicators, allowing them to interpret financial information of their customers and make recommendations to improve financial performance. Sage View can calculate specific key performance indicators and display the results in graphical format for various time periods.
Call us to discuss the options available for real-time reporting and the integration of your data into Sage View.