Accountants For Creatives: 4 Critical Reports Your Financial Management System Must Have
By Ayo Otubanjo
To maximise your creative agency’s profits you need to know your key financial information. You wouldn’t drive a car without a dashboard!
In addition to the usual profit and loss statement, balance sheet and cash flow forecasts, these are the four critical financial reports that can improve your agency’s overall productivity and profitability. Any financial management system which does not provide these as part of its reporting module is not worth investing in.
1) Profit Analysis Report
This report allows you to compare estimated to actual costs, billable and invoiced amounts to give you a clear understanding of how profitable your work is. You should be able to apply filters while creating the report to show specific information such as:
- Client names
- Date ranges
- Each job status
2) Staff Utilisation
Here you’ll find a summary view of available staff hours, hours worked and billable hours organised by role and staff. It should display the total available hours for staff in a given date range, their target billable hours (set in staff details page), the total hours worked and the amount of those hours that were billable.
3) Efficiency Report
This report provides information on the efficiency of all of your active staff. Information should include the number of billable and non-billable hours, as well as the values of the billable hours versus the payroll cost of the individual. The number of jobs worked on by the individual should also be included.
4) WIP – Work In Progress
This report displays job level details and financial information such as a breakdown of actual, estimated, variance, invoiced and un-billed values.
These are some of the reports that will help you manage projects at your agency and avoid project overruns. The purpose of using agency management software is to give you a clear understanding of what jobs are profitable, look at your staff utilisation, scheduling, timelines and anything directly related to your day-to-day activities.
Taken together, these reports should highlight how well your creative agency is run.
You would not drive a car blindfolded, so why run your agency without the key information showing where your business is heading?
Boost the bottom line for your agency. Pick up the phone and call 020 7692 0914 and ask for Ayo.
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