How to Review Financial Reports in Bill.com: Gaining Insights into Your Business

Reviewing financial reports can feel overwhelming for many business owners and managers.

Luckily, Bill.com offers a robust yet intuitive financial reporting system that makes it easy to analyze key metrics and gain actionable insights into your business's performance.

In this post, we'll explore Bill.com's various financial statements, see how to access and customize reports, and discuss strategies for leveraging the data to enhance collections, cash flow, profitability, and overall financial clarity.

Introduction to Financial Reporting with Bill.com

This section provides an overview of Bill.com and the key benefits of using its financial reporting tools to gain insights into business performance. It sets the stage for a step-by-step guide on navigating Bill.com reports.

Exploring Bill.com's Role in Business Accounting and Reporting

Bill.com is an automated platform that streamlines invoicing workflows, payments, and financial reporting. It's designed for small and midsize businesses to simplify their accounting operations through automation.

Key features include:

Online invoicing and billing
Payment processing and tracking
Account reconciliation
Financial reporting and analysis

By centralizing these accounting tasks, Bill.com saves businesses time and provides real-time visibility into cash flow.

The Advantages of Financial Reports for Business Intelligence in Bill.com

Using Bill.com for financial reporting offers several benefits:

Consolidated reporting: Gain a comprehensive view across billing, invoicing, payments and accounting in one place.
Real-time insights: Monitor cash flow in real-time to inform financial decisions.
Custom reports: Analyze KPIs specific to your business by customizing report parameters.

Financial reports transform raw accounting data into actionable business intelligence. Bill.com makes it easy to uncover trends, forecast future performance, and optimize financial operations.

The next section will provide a step-by-step walkthrough of reviewing reports in Bill.com to extract key insights.

How do you review business financials?

The balance sheet provides a snapshot of a business's financial health at a specific point in time. It shows what a business owns and owes to give you an understanding of its financial position.

When reviewing a balance sheet to assess business financials, focus on these key components:

Assets

Assets represent what a business owns or controls that have future economic value. This includes:

Cash and cash equivalents
Accounts receivable
Inventory
Property, plants and equipment
Intangible assets like patents and trademarks

Monitor the asset trends over time. Growth in assets can indicate the business is expanding. Rapidly declining asset values may signal financial troubles.

Liabilities

Liabilities represent financial obligations that a business owes to outside parties. This includes:

Accounts payable
Short and long term debt
Other payables like wages, taxes, etc.

Review if liabilities are increasing disproportionately to assets. This shows greater debt burden that can lead to insolvency risks.

Equity

Equity represents residual ownership interest in the business's assets after liabilities are paid off. This includes:

Retained earnings
Shareholders' equity

Equity indicates the buffer the business has to sustain losses. Make sure equity is sufficiently high compared to liabilities.

Key Ratios

Analyze financial ratios like the debt-to-equity and current ratios to assess the business's financial condition. These provide more insights beyond the absolute balance sheet values.

Regularly reviewing the balance sheet and tracking key trends allows you to monitor the financial pulse and health of a business. Unexpected fluctuations may require further investigation and corrective actions to maintain financial stability.

How do you Analyse financial reports?

Financial analysis reports provide critical insights into a company's financial health and performance. Conducting regular analysis is vital for business owners and managers to track progress, uncover issues, and guide strategic decisions.

Here is a step-by-step process for analyzing financial reports in Bill.com:

Gather Relevant Financial Statements

The first step is to access the key financial statements in Bill.com, including the:

Income statement - Shows revenue, expenses, and profit/loss over a period
Balance sheet - Provides a snapshot of assets, liabilities, and equity
Cash flow statement - Tracks cash inflows and outflows

Review reports from the past 3-12 months to identify trends. Compare to budgets and targets.

Calculate Key Financial Ratios

Use the financial data to determine ratios that assess:

Liquidity - Ability to pay debts and obligations
Leverage - Use of debt financing
Profitability - Bottom line performance
Efficiency - Productivity of assets and capital

Compare results over time and to industry benchmarks.

Identify Areas for Improvement

Analyze the trends in the financial statements and ratios to pinpoint strengths, weaknesses, and opportunities. Look for:

Revenue changes
Fluctuations in costs and expenses
Working capital deficiencies
Overreliance on debt
Cash flow inconsistencies

These insights direct strategic decisions.

Regular financial analysis provides the visibility needed to monitor the business, support growth, and boost efficiency. Bill.com equips leaders with the reporting and analytics capabilities to continually assess performance.

How do you review financial statements for accuracy?

Here are 5 tips for reviewing your financial statements for accuracy:

Keep Up with Your Financial Statements
Review your financial statements regularly, at least monthly. Don't let statements pile up unreviewed. Catching errors early prevents problems down the road.
Review Your Balance Sheet for Red Flags
Does your balance sheet show negative numbers? Do your current ratios or debt ratios seem off? Red flags on your balance sheet likely indicate inaccuracies needing review.
Review Your Income Statement With Your Cash Flow Statement
Compare net income to cash flow. If very different, this discrepancy warrants further investigation into potential reporting inaccuracies.
Unpredictable Reports
Sudden, unexplained changes in financial statements often signal inaccuracies. Investigate the underlying transactions driving major shifts up or down.
Get an Accountant and Work With Them Regularly
An experienced accountant can review procedures, entries, and statements to catch errors. Meet with them regularly to verify reporting processes and accuracy.

Keeping a close eye on your financial data will help spot issues right away, ensuring statements reflect reality. Reviewing accuracy regularly also identifies process improvements to prevent future errors. Work closely with accounting professionals to leverage expertise reviewing sensitive financial information. Consistent, careful financial statement analysis safeguards your business health.

How do you review a set of financial statements?

Reviewing a set of financial statements can provide critical insights into the financial health and performance of a business. Here is an effective 6-step process:

Identify Industry Economic Characteristics

Research the economic conditions and trends in the company's industry. This context helps properly interpret their financial statements.

Identify Company Strategies

Understand the company's business model, target customers, growth strategies, etc. This provides insight into decisions that impact their finances.

Assess Financial Statement Quality

Evaluate the accuracy, completeness and reliability of the financial statements before analyzing them. Ensure they follow accounting standards.

Analyze Profitability and Risk

Compute key ratios like gross margin, ROE, debt-to-equity. Compare to industry benchmarks to assess profitability and risk. Identify positive and negative trends.

Forecast Financial Statements

Use historical statements and your analysis to forecast future income statements and balance sheets. This predicts future performance based on current trends.

Value the Firm

Use valuation models like DCF analysis to estimate business value based on expected future cash flows. Compare to market value for investment decisions.

Following this 6-step process facilitates an accurate, in-depth analysis of a company's financial statements to gain actionable business insights. Let me know if you need any clarification or have additional questions!

Navigating Bill.com's Financial Reporting Features

This section outlines the different financial reports available in Bill.com and how to access them for review and analysis.

Comprehensive List of Financial Reports in Bill.com

Bill.com offers standard reports for AR aging, AP approval, expense tracking, cash flow forecasting, and P&L. Custom reports can also be configured to provide tailored business intelligence and meet specific accounting needs.

Some key reports include:

Aging Reports: Details accounts receivable aging buckets and past due invoices
Approval Reports: Tracks pending and approved AP invoices
Expense Reports: Summarizes employee expenses and spending
Cash Flow Reports: Projects future cash flow based on AR, AP, and bank transactions
Profit & Loss Reports: Provides insights into revenue, expenses, and profitability

Custom reports allow generating financials filtered by location, department, customer, vendor, etc.

Step-by-Step Guide to Accessing Reports in Bill.com

Follow these steps to access financial reports in Bill.com:

Login to your Bill.com account
Navigate to the Reports tab on the top menu bar
Select the desired report from the left sidebar (e.g. Aging Summary)
Use the date range filters to specify the time period
Click "Run Report" to generate the output
Export the report data to Excel or CSV using the icons at the top

Configured reports can also be scheduled to run automatically on a recurring basis.

Best Practices for Generating and Exporting Financial Reports

Here are some tips for effectively using Bill.com's reporting:

Set logical date ranges based on accounting periods, quarters, years, etc.
Use Excel exports for additional formatting and customization
Enable auto-delivery to schedule reports on a recurring cadence
Adjust custom reports to focus on relevant business units and metrics
Compare period-over-period trends to identify changes and opportunities

Properly configured financial reports in Bill.com provide valuable insights into the state of the business. Learning to access, interpret, and share these reports is key for data-driven decision making.

Gaining Insights from Accounts Receivable in Bill.com

This section dives into using Bill.com's AR aging reports to improve collections tracking and cash flow forecasting.

Interpreting AR Aging Reports for Better Financial Management

Bill.com's accounts receivable (AR) aging reports provide a detailed breakdown of outstanding customer invoices by age, helping businesses track collections and cash flow. Key features for financial analysis include:

Summary vs detailed views - Toggle between a high-level AR summary by aging bucket (e.g. current, 1-30 days past due), and a detailed report listing every unpaid invoice. Use the summary to quickly monitor trends, and the detail view for customer-level collections tracking.
Customizable date ranges - Filter AR reports by specific date ranges to analyze performance over custom periods aligned with billing cycles, quarters, etc. Compare period-over-period trends.
Customer segmentation - View reports for all customers or select individual customers to analyze specific collection issues. Spot late-paying customers dragging down overall AR performance.
Downloadable CSV export - Export raw AR aging data to Excel or other systems for further analysis, data visualization, and sharing with stakeholders.

Tailoring AR Reports for Enhanced Business Insights

Bill.com provides extensive options for customizing AR aging reports to meet specific business needs:

Add/remove columns - Insert additional metadata like invoice numbers, dates, and statuses for deeper analysis into the components of AR. Remove unnecessary columns to simplify the reporting view.
Filter by custom fields - Leverage custom fields in Bill.com to tag invoices by categories like location, sales rep, project etc. and filter AR reports accordingly to analyze performance by these segments.
Save custom report templates - Save customized column layouts and filter criteria as templates to quickly generate go-to AR analysis reports on demand with a single click.

Strategies for Leveraging AR Reports to Enhance Collections

Key ways businesses can apply insights from Bill.com's AR aging reports to improve collections performance:

Analyze customer payment cycles - Identify early vs late paying customers based on historical data, and tailor collection workflows accordingly to prevent future late payments.
Schedule reminder notifications - Use detailed AR data to schedule automated late payment reminder emails and reduce manual collections efforts.
Assess collection tactics - Compare trends before and after implementing new incentives or penalties to gauge impact on customer payment behavior.
Forecast cash flow - Anticipate future collections and plan working capital needs more accurately based on historical customer payment patterns.

With real-time AR visibility and customizable reporting, Bill.com provides the insights needed to help businesses enhance collections processes, cash flow management, and overall financial performance.

Mastering Cash Flow Analysis with Bill.com Reports

Bill.com provides powerful cash flow analysis tools to help businesses effectively manage their finances. Setting up automated cash flow projections enables you to forecast expected account balances weeks or months into the future. Reviewing cash flow reports and variances then allows you to optimize decisions around collecting payments, managing disbursements, and more.

Setting Up Automated Cash Flow Projections in Bill.com

To start using Bill.com's automated cash flow analysis features:

Navigate to the Settings page
Select the Cash Flow tab
Choose whether to run cash flow analysis weekly or monthly
Customize the number of weeks or months to project balances
Save your settings

Once enabled, Bill.com will forecast expected cash balances based on pending bills, invoices, and expected clearing times for payments.

Understanding Cash Flow Reports for Effective Liquidity Management

Bill.com's cash flow analysis screens provide an overview of projected and actual cash balances over time. Key sections include:

Projected Balances: Expected account balances based on pending activity.
Actual Balances: Realized account balances to date.
Variances: Differences between projections and actuals.

Reviewing variances allows you to identify discrepancies between expected and realized cash flows. This insight enables better cash management decisions to optimize liquidity.

Leveraging Cash Flow Insights for Optimal Cash Management

With regular access to projected and actual cash balances from Bill.com, businesses can:

Collect Payments: Follow up on outstanding invoices to increase realized cash.
Manage Disbursements: Adjust vendor payments to preserve cash balances.
Optimize Cash Levels: Transfer funds between accounts to meet financial goals.

In summary, Bill.com's automated cash flow analysis provides the visibility needed to proactively manage liquidity. By setting up projections, monitoring reports, and leveraging insights, companies can optimize cash flow to support financial health.

Analyzing Profitability with Bill.com's Profit & Loss Reports

Bill.com's integrated profit and loss (P&L) reporting provides valuable insights into your business's financial performance over time. Tracking revenue, expenses, and profitability metrics can help identify opportunities to streamline operations and boost earnings.

Accessing and Understanding P&L Reports in Bill.com

To view your P&L reports in Bill.com, navigate to the Reports module from the main menu. Under "Standard Reports", select "Profit & Loss". By default, this shows your accrual basis P&L for the current calendar year.

The main sections of the P&L report include:

Revenue: Income your business has earned from products, services, etc.
Cost of Goods Sold: Direct production costs related to revenue.
Gross Profit: Revenue minus COGS.
Expenses: Ongoing operating costs like payroll, rent, utilities.
Net Operating Income: Gross profit minus expenses.
Net Income: Final profit or loss after additional income/expenses.

Reviewing these metrics on a regular basis provides visibility into the financial health and profitability of your business over time.

Customization Options for In-Depth P&L Analysis

Bill.com allows customizing your P&L reports in several ways to enable more detailed analysis:

Toggle between accrual and cash basis accounting
Add segments like customers, service lines, or regional offices
Change or compare date ranges
Show financials by department, location, etc using classes
Save customized reports for quick access later

Leveraging these options facilitates identifying your most profitable products/services, highest-spending departments, sources of revenue growth or decline quarter-over-quarter, and more.

Utilizing P&L Reports to Drive Cost Efficiency and Profitability

Regularly monitoring your P&L reporting provides visibility to make smart financial decisions for your business. Ways to utilize these reports include:

Identify your largest expenses and find opportunities to control spending
Analyze profit margins by product/service to optimize pricing
Forecast budgets and growth targets based on historical performance
Compare performance across business units, regions, etc
Inform decisions on expansion, new hires, capital investments

With insights from integrated P&L reporting in Bill.com, you can closely track your profitability metrics and make data-driven decisions to improve financial outcomes.

Conclusion: Harnessing the Full Potential of Bill.com for Financial Clarity

Recap of Financial Reporting Benefits in Bill.com

Bill.com provides powerful financial reporting capabilities that give businesses clear visibility into their cash flow, accounts receivable, profitability drivers, and more. Key benefits include:

Real-time reporting on cash flow, payments, collections, and AR aging
Insights into top customers, vendors, expenses, and revenue sources
Charts showing trends over custom time periods
Ability to drill down into transaction details
Customizable reports to match specific business needs

With robust analytics and easy report building, Bill.com enables businesses to optimize decisions through data-driven financial intelligence.

Implementing Bill.com for Streamlined Financial Reporting

Getting started with Bill.com reporting is straightforward:

Sign up for Bill.com and connect bank accounts and accounting software
Set up key information like customers, vendors, chart of accounts
Configure user roles and restrictions as needed
Build custom reports and set report delivery schedules
Analyze reports and share insights with stakeholders

With Bill.com tightly integrated with accounting platforms, financial data flows seamlessly to provide accurate real-time reporting.

Further Learning: Exploring Additional Bill.com Reporting Resources

Bill.com offers extensive resources to help users maximize value from its reporting tools, including:

Help articles on building custom reports
Blog posts on advanced reporting features
Guides for specific reporting use cases
Webinars to learn tips and tricks

With powerful analytics capabilities paired with robust learning resources, Bill.com empowers businesses to unlock transformative financial insights.