How to implement financial management reporting in a Ukrainian company

Financial management reporting is a system of creating, analyzing and presenting financial information in a company. Implementing financial management reporting in a company is an important step in ensuring effective financial management and making informed management decisions.

These reports are developed for internal use and are addressed to the company's management or stakeholders.

In most cases, financial management reports include elements such as budgets, cost reports, balance sheets, income statements, and cash flow statements. It may also contain a variety of performance indicators, graphs, charts, and other tools to visualize financial information and facilitate its analysis.

To implement financial management reporting, we recommend that businesses gradually implement the following steps:

- defining the purpose and needs: reporting can be used for internal management, tracking financial performance, cost analysis, etc;

- defining the reporting structure. What financial indicators and reports will be included in the financial management reporting of the business: balance sheet, income statement and cash flow statement;

- systematic collection of financial data from all departments or divisions of the company. It is important to use accounting programs and other necessary tools to process this data;

- conducting regular analysis of financial management reports to understand the company's financial condition;

- determination of key performance indicators that reflect important aspects of the company's financial performance, such as profitability, liquidity, asset turnover, etc;

- development of an action plan to improve the company's financial performance and its implementation;

- regular updating of financial management reports to reflect the current state of the company.

As a rule, the structure of management reporting depends on the specific type of company's activity, but there are basic forms that are generally accepted and interrelated.

These include:

- income statement. This report shows how much profit the business makes;

- cash flow statement. It helps to clearly see the company's incoming and outgoing cash flows and avoid cash gaps.

- management balance sheet, which illustrates the monetary value of the property owned by the business, as well as the sources from which the company's balance sheet was formed.

To assist in the implementation and analysis of financial management reporting, we recommend that businesses engage specialists such as financiers and accountants, as financial management reporting is a so-called tool that can significantly improve the financial performance and competitiveness of a company if it is used correctly and systematically updated.