Home / Blog / Accounting Tips / Financial Statements & Taxes / Monthly reports are good; Quarterly reports are better
Monthly reports are good; Quarterly reports are better
While monthly benchmarks are critical to most businesses, analysis of monthly financial information is generally skewed due to special circumstances – days open for business or frequency of payroll runs. Quarterly analysis proves much smarter as the positive or negative monthly spikes are flattened by a longer reporting period. Thus, true trends can be spotted, which may permit corresponding reaction to be appropriate rather than rash.
Posted by Derek Ashauer on December 15th, 2008 at 11:55 pm
I’ve found this to be very true – certain months can be “dead” or “heavy” depending on the timing of receiving deposits and collecting final balances. We can be just as busy in 2 different months but the income levels can be very different for each as a result of this timing. If you have a business like ours where we get paid at the start and completion of a project you definitely need to evaluate your reports over longer periods of time to get a better reflection of how you are doing.