What is the importance of financial reporting analysis ? December 19, 2020 by Osolutions Business intelligence Do you imagine the power of tracking a very simple activity in your company? A huge decision could be taken according to this data. One of the most important departments in any company is the financial department. Due to the wide role of this department and how this department could play a major role in the future of your company, so appear here the importance of the financial reporting analysis but do you know what is the financial reporting and how to get the benefit of this osolutions financial tool. In this article, we will explore more about it and why you should adopt this analysis in your company. And now let’s start with the definition for financial reporting. What’s the financial reporting analysis? It’s the way that you will give the stakeholders an accurate vision for your company position from the point of view of revenues, profits, expenses, cash flow, and capital. And by this reporting, you will go in-depth in the financial position that might help you to make the right decision based on your situation. it is the tool that shows the health of your company in terms of financial situation. But it does not go in-depth into the culture or the structure of the company. What’s the importance of financial reporting? The most important questions that any business owner asks: “Why should I adopt the financial reporting in my company?”and “What is the benefit of using financial reporting?” And To know the answer to this question, you have to know why is it important . We’ll show to you now the benefits of financial reporting: Know your debt situation: One of the most important factors that might affect your business is debt. So the financial reporting work on tracking your assets and dividing it with your current liabilities then you’ll know your debt situation. Based on this analysis, it’ll help you to gauge your liquidity and manage the current debt to maintain your good financial health. Identifications of trends:The financial reporting will help you to identify trends, any kind of trends: past trends or current trends.But what’s the purpose of knowing the trends? During studying our company performance,some weakness in certain times in your financial curve could be a result of a trend so you will know the reasons for your weakness and work on avoiding this weakness and to improve your company health. Gaining time:The financial reporting analysis will help you to have accurate insights into your company’s financial health in real-time,to make the right decisions at the right time. By using it, you’ll avoid losing any opportunity that will maintain your financial situation. Manage your liabilities:liabilities are a very critical point while studying the financial situation and working on maintaining the health of your company including the financial situation.The liabilities appear in many different forms: business loans, credit lines, credit cards, and credit extended from vendors. Tracking your liabilities will help you to know the right situation especially if you’re seeking a business expansion loan,so you have to manage your liabilities before taking the first step in this loan. Maintain your progress:The financial reporting analysis has a major role in delivering to you accurate data at the right time which will help you to make the right decisions on time.So you’ll be able to maintain the progress of your company. Decisions Making:Financial reporting is your way to take insights and to announce the red flags at many certain times.Then, it’s your time to make the decision. What are the criteria for it ? After going in-depth into the benefits of financial reporting analysis, let’s know what is the criteria of the financial reporting. But due to the huge hole of financial analysis, we will provide you with a simple idea to be on the same path as your service provider. Till now, there are 3 ways to do financial reporting worldwide. Those 3 ways are: The GAAP (Generally Accepted Accounting Principles): it’s only used in The United States. The IFRS (International Financial Reporting Standards): It’s applied in more than 110 countries. China and India have their own customized IFRS. The GDPR (The General Data Protection Regulation): It’s a new system applied recently. It’s a way to modernize the laws that protect personal information. How to apply financial reporting in the company? it is your way to track every single activity in your financial situation which will help you to maintain your company progress and make the right decisions. But how to apply this system in your company? Applying this system in any company, it’s a very complicated process to be able to study your financial situation and read the insights. You have to ask for help from some experts in the financial reporting analysis. Osolutions Financial tool offers you the financial reporting analysis system, to track your company’s position and suggest to you the right decisions to avoid any type of loss. In conclusion, tracking any single detail in your company, it’s your way to achieve the goals of your company. It’s your method to study your company’s health in terms of financial situation and to make the decisions that could help your company. The financial Reporting Analysis is a service provided by expertise in the financial field. Osolutions provides it for you to maintain your company progress in the right way, contact us to know more about the financial analysis, and to get all the benefits of this software. Your Progress with Osolutions!