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What’s in an Equity Research Report?

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financial research report example

Even though you can easily find real equity research reports via the magical tool known as “Google,” we’ve continued to get questions on this topic.

Whenever I see the same question over and over again, you know what I do: I bash my head in repeatedly and contemplate jumping off a building…

…and then I write an article to answer the question.

To understand an equity research report, you must understand what goes into a  stock pitch first.

The idea is similar, but an ER report is a “watered-down” version of a stock pitch.

But banks have some very solid reasons for publishing equity research reports:

Why Do Equity Research Reports Matter?

You might remember from previous articles that equity research teams do not spend that much time writing these reports .

Most of their time is spent speaking with management teams and institutional investors and sharing their views on sectors and companies.

However, equity research reports are still important because:

  • You do still spend some time doing the required modeling work (~15%) and writing the reports (~20%).
  • You might have to write a research report as part of the interview process.

For example, if you apply to an equity research role or an equity research internship , especially in an off-cycle process, you might be asked to draft a short report on a company.

And then in roles outside of ER, you need to know how to interpret reports quickly and extract the key information.

Equity Research Reports: Myth vs. Reality

If you want to understand equity research reports, you have to understand first why banks publish them: to earn higher commissions from trading activity.

A bank wants to encourage institutional investors to buy more shares of the companies it covers.

Doing so generates more trading volume and higher commissions for the bank.

This is why you rarely, if ever, see “Sell” ratings, and why “Hold” ratings are far less common than “Buy” ratings.

Different Types of Equity Research Reports

One last point before getting into the tutorial: There are many different types of research reports.

“Initiating Coverage” reports tend to be long – 50-100 pages or more – and have tons of industry research and data.

“Sector Reports” on entire industries are also very long. And there are other types, which you can read about here .

In this tutorial, we’re focusing on the “Company Update” or “Company Note”-type reports, which are the most common ones.

The Full Tutorial, Video, and Sample Equity Research Reports

For our full walk-through of equity research reports, please see the video below:

Table of Contents:

  • 1:43: Part 1: Stock Pitches vs. Equity Research Reports
  • 6:00: Part 2: The 4 Main Differences in Research Reports
  • 12:46: Part 3: Sample Reports and the Typical Sections
  • 20:53: Recap and Summary

You can get the reports and documents referenced in the video here:

  • Equity Research Report – Jazz Pharmaceuticals [JAZZ] – OUTPERFORM [BUY] Recommendation [PDF]
  • Equity Research Report – Shawbrook [SHAW] – NEUTRAL [HOLD] Recommendation [PDF]
  • Equity Research Reports vs. Stock Pitches – Slides [PDF]

If you want the text version instead, keep reading:

Watered-Down Stock Pitches

You should think of equity research reports as “watered-down stock pitches.”

If you’ve forgotten, a hedge fund or asset management stock pitch ( sample stock pitch here ) has the following components:

  • Part 1: Recommendation
  • Part 2: Company Background
  • Part 3: Investment Thesis
  • Part 4: Catalysts
  • Part 5: Valuation
  • Part 6: Investment Risks and How to Mitigate Them
  • Part 7: The Worst-Case Scenario and How to Avoid It

In a stock pitch, you’ll spend most of your time and energy on the Catalysts, Valuation, and Investment Risks because you want to express a VERY different view of the company .

For example, the company’s stock price is $100, but you believe it’s worth only $50 because it’s about to report earnings 80% lower than expectations.

Therefore, you recommend shorting the stock. You also recommend purchasing call options at an exercise price of $125 to limit your losses to 25% if the stock moves in the opposite direction.

In an equity research report, you’ll still express a view of the company that’s different from the consensus, but your view won’t be dramatically different.

You’ll spend more time on the Company Background and Valuation sections, and far less time and space on the Catalysts and Risk Factors. And you won’t even write a Worst-Case Scenario section.

If a company seems overvalued by 50%, a research analyst would probably write a “Hold” recommendation, say that there’s “uncertainty around several customers,” and claim that the company’s current market value is appropriate.

Oh, and by the way, one risk factor is that the company might report lower-than-expected earnings.

The Four Main Differences in Equity Research Reports

The main differences are as follows:

1) There’s More Emphasis on Recent Results and Announcements

For example, how does a recent product announcement, clinical trial result, or earnings report impact the company?

You’ll almost always see recent news and updates on the first page of a research report:

Equity Research Report Cover Page

These factors may play a role in hedge fund stock pitches as well, but more so in short recommendations since timing is more important there.

2) Far-Outside-the-Mainstream Views Are Less Common

One comical example of this trend is how all 15 equity research analysts covering Enron rated it a “buy” right before it collapsed :

Equity Research Report for Enron With Buy Recommendation

Sell-side analysts are far less likely to point out that the emperor has no clothes than buy-side analysts.

3) Research Reports Give “Target Prices” Rather Than Target Price Ranges

For example, the company is trading at $50.00 right now, but we expect its price to increase to exactly $75.00 in the next twelve months.

This idea is completely ridiculous because valuation is always about the range of possible outcomes, not a specific outcome.

Despite horrendously low accuracy , this practice continues.

To be fair, many analysts do give target prices in different cases, which is an improvement:

Equity Research Report with Target Share Price Range

4) The Investment Thesis, Catalysts, and Risk Factors Are “Looser”

These sections tend to be “afterthoughts” in most reports.

For example, the bank might give a few reasons why it expects the company’s share price to rise: the company will capture more market share than expected, it will be able to increase its product prices more rapidly than expected, and a competitor is about to go bankrupt.

However, the sell-side analyst will not tie these factors to specific share-price impacts as a buy-side analyst would.

Similarly, the report might mention catalysts and investment risks, but there won’t be a link to a specific valuation impact from each factor.

So the typical stock pitch logic (“We think there’s a 50% chance of gaining 80% and a 50% chance of losing 20%”) won’t be spelled out explicitly:

equity-research-report-04

Your Sample Equity Research Reports

To illustrate these concepts, I’m sharing two equity research reports from our financial modeling courses :

The first one is from the valuation case study in our Advanced Financial Modeling course , and the second one is from the main case study in our Bank Modeling course .

These are comprehensive examples, backed by industry data and outside research, but if you want a shorter/simpler example you can recreate in a few hours, the Core Financial Modeling course has just that.

In each case, we started by creating traditional HF/AM stock pitches and valuations and then made our views weaker in the research reports.

The Typical Sections of an Equity Research Report

So let’s briefly go through the main sections of these reports, using the two examples above:

Page 1: Update, Rating, Price Target, and Recent Results

The first page of an “Update” report states the bank’s recommendation (Buy, Hold, or Sell, sometimes with slightly different terminology), and gives recent updates on the company.

For example, in both these reports we reference recent earnings results from the companies and expectations for the next fiscal year:

ERR Buy Recommendation

We also give a “target price,” explain where it comes from, and give our estimates for the company’s key financial metrics.

We mention catalysts in both reports, but we don’t link anything to a specific valuation impact.

One problem with providing a specific “target price” is that it must be based on specific multiples and specific assumptions in a DCF or DDM.

So with Jazz, we explain that the $170.00 target is based on 20.7x and 15.3x EV/EBITDA multiples for the comps, and a discount rate of 8.07% and Terminal FCF growth rate of 0.3% in the DCF.

Next: Operations and Financial Summary

Next, you’ll see a section with lots of graphs and charts detailing the company’s financial performance, market share, and important metrics and ratios.

For a pharmaceutical company like Jazz, you might see revenue by product, pricing and # of patients per product per year, and EBITDA margins.

For a commercial bank like Shawbrook, you might see loan growth, interest rates, interest income and net income, and regulatory capital figures such as the Common Equity Tier 1 (CET 1) and Tangible Common Equity (TCE) ratios:

equity-research-report-06

This section of the report explains how the analyst or equity research associate forecast the company’s performance and came up with the numbers used in the valuation.

The valuation section is the one that’s most similar in a research report and a stock pitch.

In both fields, you explain how you arrived at the company’s implied value, which usually involves pasting in a DCF or DDM analysis and comparable companies and transactions.

The methodologies are the same, but the assumptions might differ substantially.

In research, you’re also more likely to point to specific multiples, such as the 75 th percentile EV/EBITDA multiple, and explain why they are the most meaningful ones.

For example, you might argue that since the company’s growth rates and margins exceed the medians of the set, it deserves to be valued at the 75 th percentile multiples rather than the median multiples:

equity-research-report-07

Investment Thesis, Catalysts, and Risks

This section is short, and it is more of an afterthought than anything else.

We do give reasons for why these companies might be mis-priced, but the reasoning isn’t that detailed.

For example, in the Shawbrook report we state that the U.K. mortgage market might slow down and that regulatory changes might reduce the market size and the company’s market share:

Equity Research Report Investment Risks

Those are legitimate catalysts, but the report doesn’t explain their share-price impact in the same way that a stock pitch would.

Finally, banks present Investment Risks mostly so they can say, “Well, we warned you there were risks and that our recommendation might be wrong.”

By contrast, buy-side analysts present Investment Risks so they can say, “There is a legitimate chance we could lose 50% – let’s hedge against that risk with options or other investments so that our fund does not collapse .”

How These Reports Both Differ from the Corresponding Stock Pitches

The Jazz equity research report corresponds to a “Long” pitch that’s much stronger:

  • We estimate its intrinsic value as $180 – $220 / share , up from $170 in the report.
  • We estimate the per-share impact of each catalyst: price increases add 15% to the share price, more patients from marketing efforts add 10%, and later-than-expected generics competition adds 15%.
  • We also estimate the per-share impact from the risk factors and conclude that in the worst case , the company’s share price might decline from $130 to $75-$80. But in all likelihood, even if we’re wrong, the company is simply valued appropriately at $130.
  • And then we explain how to hedge against these risks with put options.

The same differences apply to the Shawbrook research report vs. the stock pitch, but the stock pitch there is a “Short” recommendation where we claim that the company is overvalued by 30-50%.

And that sums up the differences perfectly: A Short recommendation with 30-50% downside in a stock pitch turns into a “Hold” recommendation with roughly equal upside and downside in a sell-side research report.

I’ve been harsh on equity research here, but I don’t want to disparage it too much.

There are many positives: You do get more creativity than in IB, it might be better for hedge fund or asset management exits, and it’s more fun to follow companies than to grind through grunt work on deals.

But no matter how you slice it, most equity research reports are watered-down stock pitches.

So, make sure you understand the “strong stuff” first before you downgrade – even if your long-term goal is equity research.

You might be interested in:

  • The Equity Research Analyst Career Path: The Best Escape from a Ph.D. Program, or a Pathway into the Abyss?
  • Private Equity Regulation : 2023 Changes and Impact on Finance Careers
  • Stock Pitch Guide: How to Pitch a Stock in Interviews and Win Offers

financial research report example

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street . In his spare time, he enjoys lifting weights, running, traveling, obsessively watching TV shows, and defeating Sauron.

Free Exclusive Report: 57-page guide with the action plan you need to break into investment banking - how to tell your story, network, craft a winning resume, and dominate your interviews

Read below or Add a comment

15 thoughts on “ What’s in an Equity Research Report? ”

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Hi Brian, what softwares are available to publish Research Reports?

financial research report example

We use Word templates. Some large banks have specialized/custom programs, but not sure how common they are.

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Is it possible if you can send me a template in word of an equity report? It will help the graduate stock management fund a lot at Umass Boston.

We only have PDF versions for these, but Word should be able to open any PDF reasonably well.

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Do you also provide a pre constructed version of an ER in word?

We have editable examples of equity research reports in Word, but we generally only share PDF versions on this site.

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Hey Brian Can you please help me with coverage initiated reports on oil companies. I could not find them on the net. I need to them to get equity research experience, after which only I will be able to get into the field. I searched but reports could not be found even for a price. Thanks

We have an example of an oil & gas stock pitch on this site… do a search…

https://mergersandinquisitions.com/oil-gas-stock-pitch/

Beyond that, sorry, we cannot look for reports and then share them with you or we’d be inundated with requests to do that every day.

No worries. Thanks!

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Hi! Brian! Do u know how investment bankers design and layout an equity research? the software they use. like MS Word, Adobe Indesign or something…? And how to create and layout one? Thanks

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where can I get free equity research report? I am a Chinese student and now study in Australia. Is the Morning Star a good resource for research report?

Get a TD Ameritrade to access free reports there for certain companies.

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How do you view the ER industry since the trading commission has been down 50% since 2007. And there are new in coming regulation governing the ER reports have to explicitly priced and funds need to pay for the report explicity rather than as a service comes free with brokerage?

In addition the whole S&T environment is becoming highly automated.

People have been predicting the death of equity research for over a decade, but it’s still here. It may not be around in 100 years, but it will still be around in another 10 years, though it will be smaller and less relevant.

Yes, things are becoming more automated, but the actual job of an equity research analyst or associate hasn’t changed dramatically. A machine can’t speak with investors to assess their sentiment on a company – only humans can do that.

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Equity Research Report

Step-by-Step Guide to Understanding an Equity Research Report

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financial research report example

What is an Equity Research Report?

Sell-side equity research analysts primarily communicate their ideas through published equity research reports.

In this article, we describe the typical components of a research report and show how they are used by both the buy side and sell side .

Equity research reports are usually available for a fee through financial data providers .

Near the bottom of the article, we include a downloadable sample equity research report by JP Morgan.

Equity Research Report Timing

Quarterly earnings release vs. initiating coverage report.

Barring a new company initiation or an unexpected event, equity research reports tend to immediately precede and follow a company’s quarterly earnings announcements.

That’s because quarterly earnings releases tend to be catalysts for stock price movements, as earnings announcements likely represent the first time in 3 months that a company provides a comprehensive financial update.

Of course, research reports are also released immediately upon a major announcement like an acquisition or a restructuring . Additionally, if an equity research analyst initiates coverage on a new stock, he/she will likely publish a comprehensive initiation piece.

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How to Interpret Equity Research Reports

Buy, sell, and hold ratings.

Equity research reports are one of several types of key documents analysts have to gather before diving into a full-scale financial modeling project. That’s because research reports contain estimates used widely by investment bankers to help drive the assumptions underpinning  3-statement models and other models commonly built on the sell side .

On the buy side , equity research is also widely used. Like investment bankers, buy-side analysts find the insights in sell-side equity research reports helpful. However, equity research is used to help the buy side professional understand the “street consensus,” which is important for determining the extent to which companies have an unrealized value that may justify an investment.

The three main types of ratings ascribed by equity research analysts are the following:

  • “Buy” Rating → If an equity research analyst marks a stock as a “Buy”, the rating is a formal recommendation that upon analyzing the stock and the factors that drive price movements, the analyst has determined the stock is a worthwhile investment. The markets tend to interpret the rating as a “Strong Buy”, especially if the report’s findings resonate with investors.
  • “Sell” Rating → In order to preserve their existing relationships with the management teams of publicly traded companies, equity analysts must strike the right balance between releasing objective analysis reports (and recommendations) and maintaining an open dialogue with the company’s management team. That said, a “Sell” rating is rather uncommon in occurrence because the market is aware of the relationship dynamics (and will interpret it as a “Strong Sell”). Otherwise, the analyst’s rating can be framed to not cause a steep decline in the market share price of the underlying company, while still releasing their findings to the public.
  • “Hold” Rating → The third rating, a “Hold”, is fairly straightforward as it indicates that the analyst concluded that the projected performance of the company is in line with either its historical trajectory, industry comparable companies, or the market as a whole. In other words, there is a lack of a catalyst event that could cause a substantial swing — either up or down — in the share price. As a result, the recommendation is to continue to hold and see if any notable developments emerge, but regardless, continuing to hold the stock not too risky and minimal volatility in pricing should be anticipated in theory.

In addition, two other common ratings are “Underperform” and “Outperform”.

  • “Underperform” Rating → The former, an “Underperform”, indicates the stock may lag behind the market, but the near-term slowdown does not necessarily mean that an investor should liquidate their positions, i.e. a moderate sell.
  • “Outperform” Rating → The latter, an “Outperform”, is a recommendation to buy a stock because it appears likely to “beat the market.” However, the anticipated excess return above the market return is proportionally minor; hence, the “Buy” rating was not offered, i.e. a moderate buy.

Sell-Side Equity Research Report Anatomy

Key sections of er report.

A full equity research report, as opposed to a short one-page “note”, usually includes:

  • Investment Recommendation : The equity research analyst’s investment rating
  • Key Takeaways : A one-page summary of what the analyst thinks is about to happen (ahead of an earnings release) or his/her interpretation of the key takeaways from what has just happened (immediately after the earnings release)
  • Quarterly Update : Comprehensive detail about the preceding quarter (when a company has just reported earnings)
  • Catalysts : Details about the company’s near-term (or long-term) catalysts that are developing are discussed here.
  • Financial Exhibits : Snapshots of the analyst’s earnings model and detailed forecasts

Equity Research Report Example: JP Morgan Hulu (PDF)

Use the form below to download a research report from JP Morgan by the analyst covering Hulu.

Get the Sample Equity Research Report

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I was looking for a template In word format, it would be very helpful. Nice webpage!

Thanks, but unfortunately we don’t have a Word template as these research reports have additional built-in functionality (charts, legal disclosures, etc).

was looking for an equity research report template

This article provides a report example, not a template. But we encourage you check out our financial statement modeling course!

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financial research report example

financial research report example

Here’s How to Write an Equity Research Report: The Best Guide

October 17, 2016

The Advanced Guide to Equity Research Report Writing

Equity Research is a rewarding career.

To keep up, you need a strong foundation with the judgment to think critically, act independently, and be relentlessly analytical.

That’s why I wrote this guide — to empower you with the equity research(ER) report writing skills to stay ahead in the equity research career.

There is almost NO guide available that teaches you how to write an equity research report.

From textbooks to online video tutorials, you can check and let me know if you find one.

And, I felt that I should write a detailed and step-by-step guide— a guide that really starts at the beginning to equip already-intelligent analysts with a healthy balance of conceptual and practical advice.

The Advanced Guide to Equity Research Report Writing takes your writing to the next level.

Who Is This Guide for?

I wrote this guide for an audience of equity research analysts , investment banking professionals, industry analysts, market research professionals, business management students, and freelance writers.

Most of all, I want you to walk away from this guide feeling confident about your equity report writing skill.

What Is an Equity Research Report

This chapter explains what exactly an ER report is.

The questions like—Who makes it? Who reads and uses it? What are the different types of equity research reports?—are answered clearly and elaborately.

It briefly talks about the various key contents of an ER report.

And lastly, it explains the need to provide a disclaimer at the end of an ER report.

So before understanding how to write an ER report, let’s try to understand what exactly an equity ER is.

FINRA , the Financial Industry Regulatory Authority, defines an equity research report, in Rule 2711 (a)(8) as,

 “A written or electronic communication that includes an analysis of equity securities of individual companies or industries , and that provides information reasonably sufficient upon which to base an investment decision.

Readers of Equity Research, more so than anything else, identify trends that make investment decisions easier to justify.

In simpler words, equity research is a document written and published by a brokerage house or securities firm for its clients to help them to make better decisions regarding which stocks to choose for profitable investment.

The report should be such that it should convince the client to make a decision.

The report should be crisp; the point of view should be clearly structured and articulated concisely.

In the investment industry, equity reports usually refer to ‘sell-side’ research, or investment research created by brokerage houses.

Such research is circulated to the corporate and retail clients of the brokerage house that publishes it.

Research produced by the ‘buy-side’, which includes mutual funds, pension funds, and portfolio managers, is usually for internal use and is not distributed to outside parties.

a. Different types of equity reports

In the above paragraph, we saw terms such as ‘sell-side’ and ‘buy-side’.

Let’s quickly understand what these terms mean:

There are two main types of equity research reports:

i. Sell-Side reports

Sell-side reports are the most common type of equity research reports in circulation.

They are normally produced by investment banks , typically for their clients to guide their investment decisions.

A sell-side analyst works for a brokerage firm or bank which manages individual clients and makes investment recommendations to them.

Sell-side analysts issue the often-heard recommendations of “buy”, “hold”, “neutral”, or “sell”.

These recommendations help clients make decisions to buy or sell stocks.

This is favourable for the brokerage firm as each time a client takes a decision to trade; the brokerage firm gets a commission on the transactions.

Click here to see some examples of sell-side reports

ii. Buy-Side reports

The ‘buy-side’ reports are internal reports, produced for the bank itself, and are guided by differing perspectives and motivations.

A buy-side analyst generally works for a mutual fund or a pension fund company.

They perform research and make recommendations to the money managers of the fund that hires them.

Buy-side analysts will verify how promising an investment seems and how well it fits with the fund’s investment strategy.

These recommendations are made exclusively for the benefit of the fund that employs them and is not available to anyone outside the fund.

Within the buy/sell group, there are other types of reports like initiating coverage reports, standard reports, Issue reports, Investor notes, and sector reports.

iii. Initiating coverage reports

The initiating coverage reports are conducted on firms that the bank has begun following and are typically more comprehensive in nature.

Initiating coverage reports analyze a company’s historical financial information, order books, efficiency, SWOT, cash-flows, and future earning potential, basis which it estimates the future earnings of the company and its P/E multiples.

Click here to see some examples of initiating coverage reports

iv. Standard reports

After an initiating report is produced standard reports will follow for as long as the brokerage house continues to track the stock.

Stocks that are tracked are typically part of an index like the SENSEX or are amongst the top stocks in an industry as these are the stocks that investors care about and are traded in larger volumes.

v. Issue reports

These reports are issued when generally companies announce earnings each quarter (Quarterly earnings reports).

vi. Investor notes

These reports are published a few times in between for incremental information and news.

For example – investor conference companies hold a big M&A deal or a major new product announcement from a competitor.

These are usually short-run updates and are typically just quantitative in nature.

vii. Sector reports

A sector report is a document that evaluates a given industry and the companies involved in it.

It is often included as part of a business plan and typically seeks to establish how one company can gain an advantage in industry through detailed research on competition, products, and customers.

Click here to download the sector report

b. Contents of an equity research report

Now that we have understood the different types of equity research reports, let’s try to see the contents of an ER report.

An ER report should not be more than 10 to 15 pages long and should be very crisp and concise.

It should give the reader a clear understanding of the opinion of the analyst writing the report.

An ER report typically has the following contents:

1. Analyst opinion and summary

2. Key highlights of the company

3. A snapshot of the industry

4. Financial ratio analysis

5. Financial Modeling and Valuation analysis

6. Risk factors

7. Disclosure and rationale of rating

Usually, most of the equity research reports have this information; however, there is no hard and fast rule in which an ER report should be written.

We will study in detail (with examples) how to write each of these segments of an ER report in the forthcoming chapters.

c. Importance of Disclaimers in Analyst Reports

As every ER report is an investment document, and investors use it to make decisions for buying or selling securities based on it, it is important for the report to have certain disclaimers to show un-biases of the analyst writing the report.

Some typical disclaimers are as follows:

  • Every ER report entirely reflects views and personal opinions of the analyst as on the date of publication
  • The equity research analyst does not have an interest in the shares of the company
  • Compensation of the analyst is not linked directly to any specific research recommendations contained in the report

Financial Analysts or equity research analysts working in brokerage firms or sell-side analysts write equity research reports.

Equity research report writing process

Equity Research Report writing

After completing the fundamental analysis, financial statement analysis, ratio analysis, and valuation, the last part of the equity research process is writing equity research reports.

As an equity research analyst, you need to analyze the industry and the company first and then write the stock research report.

This step is paramount in your equity research analysis career .

This is important to write the equity research reports in such a way that your clients understand every word of it.

It’s also important to include relevant analysis that you’ve done in the report.

How to write a report

Let’s see each step of writing an equity research report in detail.

1. Company fundamental analysis

a) Macroeconomic Analysis

b) Checking public information of the company

c) Discussion/ interviews with company management

d) Prepare a 5-year cash flow model and earnings forecast model

e) Review your operational and financial assumptions

f) Assess management and competitive environment, buyers, suppliers, substitutes, porter 5-forces model that tells you the competitive advantage of the company.

2. Company valuation analysis

1. Use intrinsic valuation—Discounted Cash Flow(DCF) method

2. Relative valuation

3. sum-of-the-parts valuation method, wherever required.

Pointers for writing equity research reports

I’ve created a list of pointers purely based on my experience and observations and a bit of research about dos and don’ts while writing an equity research report.

1. A clear view of the company

Before writing the report, have a clear view of the company in terms of—Investment rationale, risk assessment, key growth drivers, cost drivers, and revenue drivers.

2. Recommendation/Rating

Clearly write the company’s name at the top of the report and mention your recommendation—buy, sell, hold.

You can also use the words—outperform, underperform, neutral or accumulate based on your valuation.

Have an image of an equity research report in your mind, and so you won’t miss these details.

Usually, there are templates available in your company and you need to write the report using these templates.

3. Target price

You need to mention the target price based on your valuation along with the recommendation.

4. Investment rationale

Write clearly your investment rationale. Why do you think the share price will go up/down?

5. Share price chart

Include a price chart of the stock that will show the last 52-weeks’ share price movement.

6.Business model

Mention the analysis of the company’s business model and how will it perform in the next 2-3 years.

7. Key ratio analysis

Include important ratio analysis of the company and 52-week high-low share price on a stock exchange.

Include market capitalization, Enterprise Value(EV), Earnings Before Interest Tax and Depreciation (EBITDA), EV/EBITDA, and dividend yield (%)

8. Product profile and segments

Analyze the company’s product profile, its various segments, and brands. Include current sales and forecasted revenue figures, cost, market size, company’s market share, competition, the company’s performance in domestic and other markets.

9. Economy-Industry-Company (E-I-C) Analysis

Cover the company’s fundamental analysis with supportive data.

10. Intrinsic and relative valuation

Perform DCF analysis and relative valuation. Relative valuation should be done with the company’s peers on the basis of Price-Earnings ratio (P/E), Price to Book ratio (P/B), Price to Sales (P/S), Return on Equity (ROE) and Return on Capital Employed (ROCE).

11. Reasoning for recommendation

Write proper reasoning for your recommendation. For example—Why buy the stock or why not to buy the stock. So, your reasoning has to be strong.

12. Unlock the value

Write what can unlock/increase/reduce the value of the company .

13. Legal matters

If the company is battling any case, write what could be its effects on the stock price.

14. Common industry points

While writing industry reports, write the points which are common for all players in the industry, for example, regulatory limitation, excise duty, oil prices, etc.

15. Covering all the areas in an equity research report

While writing the equity research report, assume that the reader is new to the company and he doesn’t have any idea about its business.

So, your report should include precise information about—product, financials, management, market, future plans of the company, growth estimates, and the risk factors of the company.

In short, as an equity research analyst, your equity analysis report writing process should be structured and you should follow the dos and don’ts mentioned in this post.

Sample equity research reports (PDFs):

The Walt Disney Company

If you have any queries, Speak Your Mind.

Key Takeaways

  • Equity research report writing is a skill . You need to build this skill to go to the next level in your career . Top-notch careers in finance–equity research, investment banking , asset management, financial research, Knowledge Process Outsourcing (KPO) units value this skill in high regard.
  • There are different types of research reports–sell-side, buy-side, initiating coverage, standard, issue, investor notes, and sector reports. As an analyst, you should know all these reports.
  • Contents of an equity research report include Analyst opinion and summary, Key highlights of the company,  A snapshot of the industry, Financial and ratio analysis, Valuation analysis, Risk factors, and Disclosure and rationale of rating. I’m going to cover all these sections in detail with examples in the coming chapters.

Now You Try It

I hope you can see the potential of equity research report writing skills for your career.

Yes, it takes hard work to create something great.

But with this skill, you already know ahead of time that your hard work is going to pay off.

I want you to give the skill a try and let me know how it works for you.

If you have a question or thought, leave a comment below and I’ll get right to it.

  • Download BIWS Course sample videos here .
  • Read Students’ Testimonials here .

Avadhut

Avadhut is the Founder of FinanceWalk. He enjoys writing on Finance Careers topics. Check our Financial Modeling Courses . Contact us for  Career Coaching based on Your Inner GPS.

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15 Financial Report Examples to Communicate Financial Data

By Danesh Ramuthi , Oct 26, 2023

Financial Report Examples

A financial report offers an in-depth view of a company’s financial status over a specific period, encompassing crucial documents like the balance sheet, income statement and the statement of cash flows. 

Such reports provide a clear lens into a company’s operations, enabling stakeholders, financial analysts and investors to evaluate both short term and long term assets and liabilities, net income and the overall financial health.

From the intricacies of accounts receivable and payable to the clarity provided by the statement of cash flow reconciles, financial reports are indispensable.

Furthermore, they reflect a company’s performance, detailing sales revenue, operating expenses and even non-operating revenue. These documents are governed by international financial reporting standards and generally accepted accounting principles, ensuring accuracy and transparency

Dive into our curated collection of 15 financial report examples that elucidate the art of communicating intricate financial data. 

And if you’re seeking an intuitive tool to craft your own financial reports, check out Vennagge’s report maker and access a range of tailored financial report templates . 

Click to jump ahead:

  • 15 Financial report examples

How to write a financial report?

What is the difference between financial reports and financial statements, 15 financial report examples to communicate financial data.

Financial reports play a pivotal role in communicating a company’s financial position, performance and projections to its stakeholders. Let’s explore a few types of financial report examples and a comprehensive view of its components and significance.

Annual financial report

The annual financial report is like a yearly check-up for a company’s money. It starts with the company’s mission and vision, which tell us what the company wants to do and where it hopes to go. 

Next, there’s a financial overview that includes important things like the profit, income, budget, expenses, net income and revenue. 

Corporate Healthcare Financial Annual Report Template

Beyond the numbers, the year’s milestones, challenges and achievements come alive in this section. 

Be it a record-breaking sales figure, expansion into new markets or innovative product launches, the highlights offer a narrative, bridging financial data with the company’s operational journey. 

Healthcare Financial Annual Report Template

Financial analysts often look at this section to gauge the company’s performance against its mission and vision, assessing its trajectory for future growth.

Monthly financial report

Monthly financial reports play a pivotal role in the financial management and oversight of any business.

These concise yet comprehensive documents capture the essence of a company’s financial activities over a month, providing valuable insights into revenue streams, expenses incurred and overall profitability.

Professional Business Financial Report Template

Tracking these monthly figures allows businesses to swiftly identify trends, pinpoint areas of concern and react to any short-term challenges before they escalate.

The timely nature of these reports means that any deviations from projected performance can be quickly addressed, ensuring that the business remains on a path of sustained growth. 

Mint Editable Financial Report Summary

Furthermore, by offering a detailed breakdown of aspects like sales revenue, operating expenses and potential liabilities, these reports empower businesses to make data-driven decisions, optimize cash flow and fortify their financial health in the competitive marketplace.

Income statement financial report

The income statement, commonly referred to as the profit and loss statement, is one of the three paramount financial statements used by businesses to showcase their financial performance over an accounting period. 

While the balance sheet provides a snapshot of assets and liabilities and the cash flow statement details cash movements, the income statement zooms in on the company’s revenues, expenses, and overall profitability.

It illuminates crucial aspects like operating expenses, sales revenue and net income, offering insights into the company’s operations and its relative standing in the industry. 

Financial Income Statement Report Template

By deciphering the data within an income statement, companies can identify areas of efficiency, detect underperforming sectors and align their strategies to ensure optimal financial performance.

Statement of cash flows financial report

A cash flow statement stands as a crucial pillar in a company’s financial reports, detailing the movement of money within the business. 

It captures all cash inflows, from everyday operations to external investment sources, and all outflows, including those that cover various business activities and investments. 

Statement of Cash Flows Financial Report Template

By examining this statement, one can understand if a company is generating enough cash from its operations or relying on external financing. 

Moreover, it helps in ascertaining how a company is managing its cash resources, providing insights into its financial health and operational efficiency.

Statement of change in equity financial report

The statement of change in equity delves deep into the shifts in a company’s equity over a defined accounting period. Commonly known as the statement of retained earnings, this document offers insights into the financial decisions that impact shareholder value. 

Statement of Change in Equity Financial Report Template

It encompasses elements like net profits or losses and the distribution of dividends. By analyzing this statement, stakeholders can grasp how well the company is doing in terms of increasing its retained earnings and thus, enhancing its overall financial health. 

This report plays a vital role in deciphering the company’s commitment to its shareholders, reflecting on its strategic financial decisions.

Financial reporting template

Summary financial report

A summary financial report can be visualized as a bird’s-eye view of a company’s financial terrain. Unlike exhaustive reports that delve deep into the numbers, this summary highlights the key aspects: revenue, expenses, cash flow, assets, liabilities and equity. 

It’s a tool that encapsulates the company’s financial story, helping investors and stakeholders quickly gauge the business’s fiscal position. 

Blue Financial Report Summary Template

Whether released quarterly or annually, this summary serves as a preliminary tool for deeper financial exploration, offering a concise yet informative glimpse into the company’s financial trajectory.

Chic Financial Report Summary

Analysis financial report

Financial reports are crucial documents that provide detailed insights into a company’s financial health and performance. At the heart of this analysis is the income statement, which offers a breakdown of a company’s sales revenue, operating expenses and net income over a specific accounting period. 

Fashion Company Financial Budget Report

Another essential element in the analysis is the balance sheet. This statement provides a snapshot of the company’s assets, liabilities and shareholders’ equity at a particular point in time. 

By comparing the company’s assets to its liabilities, one can gauge its financial stability and solvency. Additionally, elements like retained earnings give an insight into the company’s reinvestment strategies or dividend payments to shareholders. 

One should not forget the importance of financial ratios derived from these reports, such as the earnings per share (EPS), which can influence the company’s stock price. 

Blue Editable Financial Report

By following generally accepted accounting principles (GAAP) or international financial reporting standards (IFRS), companies ensure that their financial reporting examples are consistent and transparent.

Business financial report

A business financial report serves as a compass, indicating the fiscal direction and health of a company over a specified duration.

The linchpin of this report is the income statement, which paints a vivid picture of the company’s earnings landscape by detailing its total sales revenue and segregating operating from non-operating revenue.

It also shines a light on the net income or loss for the period under scrutiny. 

Yellow Business Financial Report

Another critical component of the business financial report is the balance sheet. This offers a consolidated view of the company’s assets, liabilities, and shareholder equity. 

The balance between assets and liabilities gives stakeholders a clear picture of the company’s financial stability and its ability to meet short-term and long-term debt obligations. 

For instance, accounts receivables might indicate the company’s efficiency in collecting dues, while accounts payable can provide insights into the company’s management of its debts. To supplement these, the cash flow statements show how the company manages its cash from operations, investments and financing. 

Blue Financial Report Examples

When combined, these financial documents create a holistic view of a business’s financial health, guiding decisions related to investment banking, marketable securities, and other financial accounts.

Budget financial report

A budget financial report is a forward-looking document that provides an organized and detailed plan for a company’s financial activities for a specific period. This type of report typically includes projected income statements and expected cash flow statements. 

One primary purpose of such a report is to set financial targets for the upcoming reporting period, be it short-term or long-term. By comparing these forecasts with actual financial data as the period progresses, companies can gauge their financial performance and make necessary adjustments to their business operations.

Modern Financial Budget Report Template

Budgeting plays a pivotal role in financial planning. This report delineates where a company expects its revenue to come from, be it sales revenue, operating revenue or non-operating revenue, and how it plans to spend it.

On the expenditure side, the budget might break down operating expenses, dividend payments, investment in marketable securities and more.

Additionally, this report will often account for both current assets and liabilities and long-term assets and debts. 

By analyzing the budgeted financial statements against the actual financial statements, stakeholders can understand the company’s financial position, its capacity for future growth and its overall business’s financial health. 

Moreover, the budget financial report aids in strategizing investment activities, financing activities and managing the company’s operations effectively, ensuring that the company remains on track to achieve its financial objectives.

Financial reports are instrumental in illustrating a company’s financial position and performance over a specific period. They serve as a roadmap for stakeholders, guiding business decisions and investments.

Crafting an insightful financial report involves a structured approach, detailing various financial activities and metrics.

Step 1: Offer a company overview

Begin by providing an overview of your company. This section should shed light on the company’s operations, market position and business objectives.

Ensure that the company’s financial health and major business operations are highlighted, offering readers a foundation upon which they can base the forthcoming financial data.

Step 2: Delve into sales projections and key financial aspects

Detail your company’s sales forecast, illuminating expected sales revenue and any factors influencing these projections. Additionally, delve into other crucial sections like financial targets, operating revenue and any non-operating revenue.

This offers stakeholders a bird’s-eye view of the company’s expected financial performance for the reporting period.

Step 3: Ascertain the company’s value

Incorporate a section dedicated to the company’s valuation. This should encapsulate assets and liabilities, shareholders equity and any long-term or short-term debt. The company’s valuation is pivotal for investors and financial analysts to ascertain the company’s worth and its potential for future growth.

Step 4: Add the summaries of key financial statements

A comprehensive financial report encompasses summaries of vital financial statements. Furnish a brief overview of the company’s income statement, balance sheet and cash flow statement. 

These statements provide insights into the company’s net income, assets liabilities, cash flows and the overall financial health. By adhering to international financial reporting standards or generally accepted accounting principles, you ensure transparency and consistency in financial reporting.

Step 5: Finish with the summary of the entire report

Conclude the report by summarizing your findings. This section should encapsulate your final views about the company’s financial position, performance and potential. Share opinions on whether the company is poised for profit or might incur a loss. 

Consider weaving in financial ratios or any other important financial statements that can bolster your claims. A succinct summary aids stakeholders in quickly grasping the crux of the financial report, influencing their decisions about the company’s prospects.

Related: 20 Professional Report Cover Page Examples & Templates [100% Customizable]

While both financial reports and financial statements serve as pivotal tools in illustrating a business’s financial health, they each have distinct roles and attributes.

At their core, financial statements are essentially a subset within the broader scope of financial reports. Below are the primary contrasts between these two financial tools:

Scope of the report & statement

A financial statement, such as an income statement or a cash flow statement, zooms in on a specific financial aspect. In contrast, a financial report is an amalgamation of multiple related financial details, often encompassing several statements. 

Formatting of the report & statement

Precision in presentation is important for financial statements like the balance sheet. They adhere to set standards, categorizing assets, liabilities and owner’s equity into clear segments with aggregated values for each segment. 

Financial reports, while encapsulating this data, enjoy more flexibility in their presentation format, allowing for variations that might not be possible in individual financial statements.

Length of the report & statement

Given its comprehensive nature, a financial report is typically more voluminous than a single financial statement. 

It paints a holistic picture of a company’s financial terrain, necessitating the inclusion of diverse financial metrics and analyses. 

On the other hand, a financial statement is a concise document focusing on a singular financial facet. 

From assessing an organization’s overall financial health annually to understanding monthly financial fluctuations, the variety of financial report examples underscores the importance of thorough and diverse financial reporting. 

These reports, ranging from the granular focus of income statements to the broader analysis found in summary and business reports, offer stakeholders, both internal and external, a clear window into an entity’s financial position and performance. 

Mastering the nuances of each type can significantly enhance financial transparency and decision-making.

If you’re looking to craft insightful financial reports, tools like Venngage report maker can make the process seamless. Their extensive range of financial report templates ensures you have the perfect layout and design for every financial insight you wish to share.

financial research report example

How to Write a Financial Analysis Report for Your Business

financial research report example

In this Article

Is your business worth investing in? For most of you, the answer is a definitive 'Yes.' But in the business world, talk is cheap. So if you want to attract investors, you'll need to be able to walk the talk, i.e., put your money where your mouth is. 

There's no better way to do that than with a financial analysis report. After all, numbers don't lie. They're the smoking gun investors need before investing in your business. 

Want to learn how to write a financial analysis report that attracts investors? This article covers six simple steps to follow. But first:

What is a financial analysis report?

A financial analysis report shows the financial performance of your business over a specified period of time, usually on a quarterly or yearly basis. It's like a medical report but for your business's financial health. 

In several countries, financial reporting is a requirement. The Securities and Exchange Commission requires companies to disseminate these digital reports to their shareholders in the United States. In addition, these financial reports are usually made available to the public if they're publicly-listed companies

A financial analysis report is invaluable to both you and your stakeholders. Let's discuss why you need it in the next section.

How does a financial analysis report help?

To make the right financial decisions for your business, you need data. This helps you lay a solid foundation for future performance and economic growth opportunities. 

However, you need to be able to keep track of and make sense of all your financial data. That's where a financial analysis report comes in. It helps you organize, analyze, and paint a clearer picture of your business's cash flow and allows for seamless management of business expenses too.

Aside from those, here are a couple of more reasons why you need a financial analysis report:              

Ensures transparency

A financial analysis report is easy on the eyes. It's a watered-down version of your finances that communicates essential data you need to make financial decisions. 

You ensure the transparency your stakeholders want, too. 

Tracks cash flow

Generally, financial reports help you understand cash inflows and outflows . For example, if you know your affiliate sales and operating expenses, the cost of getting links to increase website traffic , social media marketing campaign expenditure, and the money coming in, you can make better financial decisions. 

financial research report example

The information can help with debt ratios, budgeting, debt-to-asset financial ratio analysis, and calculating profit margins. 

Suggested Reads: 10 Ways to Improve Your Business's Finance Position

Allows for data-driven forecasting

Historical and real-time financial data help create financial models to predict future financial performance. These reports help you identify trends, patterns, and problems. As a result, you can plan for them early enough. 

Simplifies taxation

To create a financial analysis report, you must have all your data in a single document. It becomes easier for you to do your taxes, saves you time, and reduces the chances of making errors. Moreover, it's an official document that the Internal Revenue Service can use to calculate your taxes.

At the end of the day, the goal of a financial report is to provide insight into your organization's finances. Then, using both historical and current data, you can set SMART business goals to make better decisions for future performance. 

Finally, it's essential to consider the ongoing nature of financial analysis and the need for periodic reviews. Implementing a project review process allows you to regularly assess the financial health of your business, identify any emerging trends or issues, and make informed adjustments to your financial strategies. This continuous evaluation ensures that your financial analysis remains up-to-date and relevant, providing you and your stakeholders with accurate insights into your business's performance.

Suggested Reads: 2022 Business Expense Categories Cheat Sheet: Top 15 Tax-Deductible Categories

Benefits of a periodic financial analysis

Financial analysis makes it easy for you to identify the strengths and weaknesses of your business. Using that information will not only help your business grow but also thrive. What's more, doing financial analysis over specific periods helps you stay on top of your game by:

Helping manage debts

A periodic financial analysis includes a financial ratio analysis; specifically, a Liquidity Ratio called the Current Ratio Analysis. The Current Ratio is the sum of all your current assets divided by the sum of your current liabilities. It shows if you're liquid enough to meet your upcoming debts. So, if you aren't, you can adjust your financial strategy the soonest.

Determining profitability

When you perform a periodic financial analysis, you can determine your company's profitability and make regular adjustments. A profitability ratio is a financial metric that can help you cut production costs and boost your bottom line. 

You can use a profitability ratio (featured below) to determine your profit margin on sales, i.e., your gross profit margin. Here's the formula. 

financial research report example

It's your sales revenue minus the total cost of goods sold (COGS) divided by revenue. 

Managing inventory

Another perk of doing financial analysis over a specific period is that it helps you better manage inventory . This way, you ensure it's always enough to meet projected sales. You do this using a financial management ratio called the Inventory Turnover Ratio. 

Calculate the Turnover Ratio by dividing your total sale by your inventory.  

Checking stability and revenue growth 

The results of a periodic financial analysis yield your debt-to-equity ratio, too. It's a financial metric that shows how you've raised capital for your business. You want to check your stability and revenue growth every step of the way to determine whether your business is viable in the long run.

The debt-equity ratio is calculated by dividing your total liabilities by your shareholder's equity. It's usually included when you write a financial analysis report. 

Generally speaking, the higher your debt-equity ratio, the higher the risk, and vice versa. Investors use this financial metric to check your company's stability and ability to raise money to grow. 

Optimizing for growth

Financial analysis over specific periods helps you identify opportunities to optimize operational efficiency for revenue growth. That is, regular annual reports help you spot patterns and trends. This allows you to nip problematic areas in the bud and prepare in advance. 

For instance, you can adjust seasonal sales fluctuations, variable costs, etc. 

How to write a financial analysis report

Now that you understand a financial analysis report's 'what' and 'why,' it's time to look at the 'how.' 

Here's how to write a financial analysis report:          

1. Give an overview of the company

The first section of your financial analysis report is the company overview. Here, you want to highlight the potential of your business. It's pretty much what you do in a business plan . Investors rely on your company overview to understand your competitive edge. 

The question you want to answer here is - is your business worth the investment you're asking for? Think of the introductions in business plans or on Shark Tank to give you a better idea. As a general rule of thumb, you want to use plain language when writing your description.

You want to share, in brief, your history, business model, type of organization, description, etc. You can share what sector you're in as well as the size and scale of your business. 

Featured below is an excellent example of a fictional company's overview.        

financial research report example

Start by reviewing your quarterly or yearly financing activities, financial data, and statements. Then go through published business studies and industry-specific trade journals. 

You should consider adding a snippet about how you compare to the industry average among your competitors. Like a business plan, you want to show potential investors why they should choose you. You can use Porter's Five Forces model to analyze your competition. 

2. Write sales forecast and other vital sections

It pays to be as precise and comprehensive as possible when writing the main content. So, you’ll need to organize your data and, sometimes, make some calculations yourself. For instance, when writing your sales forecast , you need your sales data for the past three years before you organize it in financial reporting software or spreadsheets. Tally the data on a yearly, monthly (for the 1st year), and quarterly (for the last two years) basis. 

financial research report example

You can write this part using a spreadsheet. But feel free to use financial reporting software if spreadsheets aren’t your cup of tea. 

There are other sections you should create for your report’s main body. 

Let’s look at them one by one:

  • Expense budget

With your sales forecast in place, it's time to figure out how much it'll cost. When setting up your expense budget , ensure it includes variable costs like your marketing budget and fixed costs like rent. In addition, you'll need to create an estimate for items like interest and taxes. 

  • Cash flow statement

A cash flow statement summarizes all the money or its equal coming in (cash inflow) or leaving (cash outflow) a business. To create one, you need historical financial data or project it one year ahead if you're starting. Don't forget your cash flow statement is connected to your invoice.

  • Estimate for net profit

Tally your net profit using your sales forecast, expense budget, and cash flow statement data. Your net profit margin is your gross margin less taxes, interest, and expenses. Try and be as precise as possible since this can stand in as your profit and loss (P&L) statement . 

  • Estimate for assets and liabilities

Your next step is to calculate your company's net worth. How? By managing your assets and liabilities, i.e., those items that don't appear in your P&L statement. 

To do that, ballpark your monthly cash on hand. That is, equipment, inventory, land, and accounts receivable. Then sum up your liabilities, i.e., outstanding loan debts and accounts payable. 

  • Break-even point

The last step in writing a company financial analysis report is calculating your break-even point. That's where your business expenses match your sales volume. Use the formula below to find your three-year sales forecast; this will help you find your break-even point.

financial research report example

Needless to say, if you're operating a profitable business model, then your company's revenue should be higher than your operating expenses. Again, this information helps reassure potential investors of your business' stability and revenue growth potential.  

Refrain from assuming that people know the concepts you'll discuss in your report. Instead, define them in general terms first before you start talking about specifics.

financial research report example

3. Determine the company's valuation

The company valuation part is one of the most critical sections of your financial analysis report. Why? Because it helps potential investors see the value of investing in your company. 

To determine your business' valuation is to find your company's value. You do this by analyzing your company data, including all the data you have discussed. There are three main ways to do it, i.e., using the following: 

  • Discounted Cash Flow (DCF) Analysis
  • Book Value Analysis
  • Relative Value Method

The goal here is to outline your current assets and liabilities. Moreover, the above techniques help you determine your business' stocks and current value. To do this, most accountants or financial officers use insights from and final average accounts of your balance sheet. 

4. Perform risk analysis

Risk analysis helps potential investors see your company's investment potential. That includes both current and future risks. You can start risk analysis by running a SWOT analysis . 

But remember that your SWOT analysis is microscopic. So for the best results in your valuation, combine it with other techniques. For example, doing a PESTLE analysis . Here's a template you can use for that:

financial research report example

A PESTLE analysis gives you more details and offers two main benefits. First, it helps you understand your marketing environment and other macro factors that affect your company's financials. 

5. Include summaries of financial statements

When writing the financial analysis report of a company, you need to include a brief overview of your company's financial statements. To do this, summarize each component of the 3-statement model:

financial research report example

Let's discuss each of them:

Cash flow statement. Potential investors look at your cash flow statement summary for two reasons. One, it lets them see if you make enough money to settle your debts. Two, it helps them decide whether your company is worth investing in.

Income statement . A summary of this does two things. First, it shows you gaps in increasing operating profit by allowing you to boost sales revenue , reduce cost, or both. It's also an income statement showing how effective your strategies are at the start of your financial year.

Balance sheet. The balance sheet shows your debt coverage and asset liquidity in real time. The difference between assets and liabilities gives you the 'owner's equity.' Here's an example of a balance sheet:

financial research report example

Note that summarizing each of these three components doesn't mean just including tables in your report. Instead, explain what the data means in paragraph form, too.  

6. Summarize the entire report 

The last section of the financial analysis report of a company is a summary. You want to share your final views about the company and your opinion on whether it's a profit or loss. That said, be sure to substantiate all your claims. 

That means having evidence containing factual data, financial accounts, and proven financial theories. You can also include the outlook of the company. That is the type of organization, industry trends, economic growth strategies, and how they'll affect the company. 

In conclusion

By now, you should understand the value of a company financial analysis report and how to write one. Not only does it show you the financial health status of a company, but it's also the smoking gun investors look for before investing in any business. 

To any organization, a financial analysis report is a compass to optimize operational efficiency for growth. It is also a crucial part in portfolio management especially when you need to open your business up to other stakeholders.

Summarising, to write a financial analysis report, you need to: 

Write your company overview , sales forecast, and other essential sections. Once those are out of the way, you can perform company valuation and risk analysis. Then, all that's left is to summarize what was discussed. 

financial research report example

Daryl Bush is the Business Development Manager at Authority.Builders . The company helps businesses acquire more customers through improved online search rankings. He has extensive knowledge of SEO and business development.

How to Write a Financial Analysis Report in 6 steps

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How to Write an Equity Research Report

By Brian Dzingai |

 Reviewed By Rebecca Baldridge |

November 15, 2022

What is an Equity Research Report?

An equity research report may focus on a specific stock or industry sector, currency, commodity, or fixed-income instrument, or even on a geographic region or country, and generally make buy or sell recommendations. These reports are produced by a variety of sources, ranging from market research firms to in-house research departments at large financial institutions or boutique investment banks.

Key Learning Points

  • An equity research report is a document prepared by an analyst that provides a recommendation to buy, hold, or sell shares of a public company. 
  • An equity research report is a document prepared by an analyst who is part of an investment research team in a brokerage firm or investment bank
  • It provides an overview of the business, the industry it operates in, the management team, the company’s financial performance, and risks, and includes a target price and investment recommendation.
  • It is intended to help an investor decide whether to invest in a stock.

Equity Research Report Structure

An equity research report can include varying levels of detail, and although there is no industry standard when it comes to formatting, there are common elements to all equity research reports. This guide includes some fundamental features and information that should be considered essential to any research report, as well as some tips for making your analysis and report as effective as possible. 

Access the download to see a real-world example of an Equity Research Report, annotated to show each element discussed below. 

Basic Information

The research report should begin with basic information about the firm, including the company’s ticker symbol, the primary exchange where its shares are traded, the primary sector and industry in which it operates, the current stock price and market capitalization, the target stock price, and the investment recommendation. 

In addition, a security’s liquidity and float are important considerations for the equity analyst. The liquidity of a stock refers to the degree to which it can be purchased and sold without affecting the price. The analyst should understand that periods of financial stress can affect liquidity. A stock’s float refers to the number of shares that are publicly owned and available for trading and generally excludes restricted shares and insider holdings. The float of a stock can be significantly smaller than its market capitalization and thus is an important consideration for large institutional investors, especially when it comes to investing in companies with smaller market capitalizations. Consequently, a relatively small float deserves mention. Finally, it is good practice to identify the major shareholders of a firm. 

Business Description 

This section should include a detailed description of the company and its products and services. It should convey a clear understanding of the company’s economics, including a discussion of the key drivers of revenues and expenses. Much of this information can be sourced from the company itself and from its regulatory filings as well as from industry publications. 

Industry Overview and Competitive Positioning

This section should include an overview of the industry dynamics, including a competitive analysis of the industry. Most firms’ annual reports include some discussion of the competitive environment. A group of peer companies should be developed for competitive analysis. The “Porter’s Five Forces” framework for industry analysis is an effective tool for examining the health and competitive intensity of an industry. Production capacity levels, pricing, distribution, and stability of market share are also important considerations. 

It is important to note that there are different paths to success. Strength of brand, cost leadership, and access to protected technology or resources are just some of the ways in which companies set themselves apart from the competition. Famed investor Warren Buffett describes a firm’s competitive advantage as an economic “moat.” He says, “In business, I look for economic castles protected by unbreachable moats.” 

Investment Summary

This section should include a brief description of the company, significant recent developments, an earnings forecast, a valuation summary, and the recommended investment action. If the purchase or sale of a security is being advised, there should be a clear and concise explanation as to why the security is deemed to be mispriced. That is, what is the market currently not properly discounting in the stock’s price, and what will prompt the market to re-price the security? 

This section should include a thorough valuation of the company using conventional valuation metrics and formulas. Equity valuation models can derive either absolute or relative values. Absolute valuation models derive an asset’s intrinsic value and generally take the form of discounted cash flow models. Relative equity valuation models estimate a stock’s value relative to another stock and can be based on a number of different metrics, including price/sales, price/earnings, price/cash flow, and price/book value. Because model outputs can vary, more than one valuation model should be used. 

Financial Analysis

This section should include a detailed analysis of the company’s historical financial performance and a forecast of future performance. Financial results are commonly manipulated to portray firms in the most favorable light. It is the responsibility of the analyst to understand the underlying financial reality. Accordingly, a careful reading of the footnotes of a company’s financial disclosures is an essential part of any examination of earnings quality. Non-recurring events, the use of off-balance-sheet financing, income and reserve recognition, and depreciation policies are all examples of items that can distort a firm’s financial results. 

Financial modeling of future results helps to measure the effects of changes in certain inputs on the various financial statements. Analysts should be especially careful, however, about extrapolating past trends into the future. This is especially important in the case of cyclical firms. Projecting forward from the top or bottom of a business cycle is a common mistake. 

Finally, it can be informative to use industry-specific financial ratios as part of the financial analysis. Examples include proven reserves/shares for oil companies, revenue/subscribers for cable or wireless companies, and revenue/available rooms for the hotel industry. 

Investment Risks

This section should address potential negative industry and company developments that could pose a risk to the investment thesis. Risks can be operational or financial or related to regulatory issues or legal proceedings. 

Although companies are generally obligated to discuss risks in their regulatory disclosures, risks are often subjective and hard to quantify (e.g., the threat of a competing technology). It is the job of the analyst to make these determinations. Of course, disclosures of “qualified opinions” from auditors and “material weakness in internal control over financial reporting” should be automatic red flags for analysts. 

Environmental, Social & Governance (ESG)

This section should include information on how the company manages the relationships related to Environmental, Social, and Governance. Below are some examples within these three areas that can have a lasting impact on the company’s short- and long-term prospects:

  • E nvironmental – how is the company working towards the conservation of the natural world? This can include climate change and carbon emissions, air and water pollution, energy efficiency, waste management, and more. 
  • S ocial – how does the company consider people and relationships? This can include community relations, human rights, gender and diversity, labor standards, customer satisfaction, and employee engagement. 
  • G overnance – what are the standards for running the company? This can include board composition, audit committee structure, executive compensation, succession planning, leadership experience, and bribery and corruption policies. 

Enroll in our online ESG course and learn to identify the principles of ESG and how they are applied to investment strategies.

If you are interested in a career as an equity research analysts or in fixed income research, our online course covers all the key skills needed as either a sell side analyst in an investment bank or a buy side analyst working in an investment management firm.  

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How to Write a Great Financial Report? Tips and Best Practices

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Table of contents

To make informed financial decisions in your company, you first have to be, well, informed.

Understanding the financial activity of your company sets the foundation for identifying good business opportunities and making the right decisions to ensure future growth.

By tracking, organizing, and analyzing financial performances, you will have a clearer picture of where the money is going and where it’s coming from. No wonder finance is one of the most monitored and reported operations, according to Databox’s State of Business Reporting .

To stay on top of numbers, companies use financial reports.

Financial reports are formal documents that capture all the significant financial activities within a business in a specific period.

While these reports are extremely useful for you and your key stakeholders, you won’t be the only one reaping the fruits. Financial statements are also examined by potential investors and banks since they provide them with enough insight to determine whether they want to invest in your business.

In this article, we are going to walk you through what financial reports are, why they are significant and show you a step-by-step guide that will take your financial reports and business reporting as a whole, to the next level.

What Is a Financial Report?

What is the purpose of financial reporting, what are the types of financial reporting, how to write a financial report, finance report examples.

  • Improve Financial Reporting with Databox

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Financial reports are official company documents that showcase all the financial activities and performances of your business over a specific period. Usually, they are created on a quarterly or yearly basis.

Every business is legally obliged to use financial reporting to display its current financial status and organize financial data.

The documents are available for public view which means that potential banks and investors will most likely analyze them before they decide to work with you and invest in your business.

They are also important for tracking future profitability estimates, business growth, and overall financial health.

At bottom, financial reports provide you with insight into how much money you have, how much did you spend, and where it is coming from. Based on the data within the report, you can make informed business decisions and create plans for future spending.

The key things a financial report should include are:

  • Cash flow data
  • Asset and liability evaluation
  • Shareholder equity analysis
  • Profitability measurements

Related : Quarterly Business Review: How to Write One and How to Present It Successfully

Financial reports are used to track, analyze, and display your company’s cash flow .

Understanding how your business is performing from a financial standpoint can seem like an impossible task without these reports.

However, financial reports aren’t used only because they are practical; you are legally required to include them.

Here are some of the main ways in which financial reports can help your business:

Communicate essential data

Monitors income and expenses, supports financial analysis and decision-making.

  • Simplify your taxes

Having an insight into the current financial situation of your business is important to each high-ranking member of the company (stakeholders, executives, investors, and partners).

You will use this financial data to create budget plans and monitor the company’s overall performance. When you establish an open communication and transparency policy within your business, you are more likely to attract new investors and enhance funding.

The information communicated in financial statements is what investors rely on when they are assessing risks, profitability, and future returns.

One way to gain the trust of investors is to showcase how your financial performance stacks up against your peers. For example, by joining this benchmark group , you can better understand your gross profit margin performance and see how metrics like income, gross profit, net income, net operating increase, etc compare against businesses like yours.

For example, you can discover that the median gross profit a month for B2B, B2C, SaaS and eCommerce is 73.79K . If you perform better than the median, this might be a good incentive for your investors to increase your funding.

average gross profit for B2B, B2C, SaaS and eCommerce

*Important note: Databox Benchmark Groups show median values. The median is calculated by taking the “middle” value, the value for which half of the observations are larger and half are smaller. The average is calculated by adding up all of the individual values and dividing this total by the number of observations. While both are measures of central tendency, when there is a possibility of extreme values, the median is generally the better measure to use.

Benchmark Your Performance Against Hundreds of Companies Just Like Yours

Viewing benchmark data can be enlightening, but seeing where your company’s efforts rank against those benchmarks can be game-changing. 

Browse Databox’s open Benchmark Groups and join ones relevant to your business to get free and instant performance benchmarks. 

Financial reporting involves tracking incomes and expenses for a specific time period. To establish efficient debt management and budget allocation, you will need an insight into the most important spending areas .

By tracking income and expenses , you will also understand current liabilities and assets. Analyzing financial documentation will provide you with a bigger picture regarding the key metrics such as debt-to-asset ratios that investors use to calculate potential profitability.

All of this is information is crucial for staying ahead of your competitors.

Related : How to Write a Great Business Expense Report: A Step-By-Step Guide with Examples

The performance analysis in financial reports is what you rely on to make better business decisions.

Considering the different data that financial reports include, you can check out real-time information regarding historical performances, key spending areas, and use them to create accurate financial forecasts.

Implementing detailed financial analysis and using developed data models can help any business better evaluate current activities and make future business growth decisions.

You will be able to recognize trends, potential problems, and stay on top of your financial performances in real-time. This sets the foundation for quick and accurate economic decisions.

The main purpose of financial reports is to make sure your business is in compliance with the law and regulations of government agencies.

Regulatory institutions examine every document that evaluates the financial activities of your company. This is why making accurate financial documentation is crucial for the well-being of your business.

Aside from accuracy, you will also have to follow certain deadlines that these institutions set. This sometimes causes pressure in accounting departments to create complex financial reports quickly and accurately, which is why regular bookkeeping is immensely important.

In the US, private and public companies have to be compliant with the GAAP (Generally Accepted Accounting Principles), while international companies mostly report under the IRFS (International Reporting Financial Standards).

Both of these organizations provide some standard guidelines but there are a few differences you will have to pay attention to when creating your financial statements.

Simplify your taxes  

No matter how big or small your business is, doing taxes can be a stressful task.

By creating accurate financial reports, you can make tax calculation a lot easier since you will minimize any chances of error and save time by including all financial data in one document.

Not only that, since financial reports are a legal requirement, the IRS uses them to evaluate the tax income of each individual company. 

Additionally, with the introduction of Making Tax Digital (MTD) in many countries, including the UK, it is now mandatory for businesses to maintain digital records and submit tax returns digitally. This means that accurate financial reports are more important than ever, as they will be used to populate the required digital tax submissions.

While financial reports all have the same goal, there are a few different types that you should know about.

This isn’t only a matter of compliance or best practice, these reports are key for understanding the different segments of cash flow.

Here are the main types of financial reporting:

Balance Sheet

Cash flow statement, income statement, shareholder equity statement.

A balance sheet is a financial statement that tracks the total amount of assets, liabilities, and shareholder equities within your company. They also provide you with a real-time evaluation of asset liquidity and debt coverage.

Most companies create balance sheets on a quarterly basis and include the data from each quarter in the annual report.

When creating a balance sheet, there is an asset page (includes available cash, equipment value, inventory value, etc.) and a liability page (includes accounts payable, credit card balances, bank loans, etc.) that you need to fulfill.

Once you total these assets and liabilities, you will subtract liabilities from the assets. The amount you get is what is called ‘owner’s equity’.

This is a financial statement that records all the different cash flow activities in the company.

Cash flow statements track cash generated and cash spent amounts in a specific time period. This report is crucial for measuring whether companies generate enough cash to cover their debts. Also, it provides insight into fund operations, investments, and the overall activities that are generating revenue.

This statement is helpful for investors since they can use it to determine whether your business presents a good investment opportunity .

While balance sheets incorporate certain calculations to determine financial values, cash flow statements are consisted of three main elements:

  • Operational activities – inventories, wages, tax income, accounts receivable, accounts payable, and cash receipts
  • Investment activities – investment earnings use, investment earnings generation, asset sales, issued loans, payments from mergers
  • Financing activities – payable dividends, debt payments, debt issuance, cash from investors, and stock repurchases

The income statement records the company’s expenses, revenue, and net loss/income over a specific time period.

Balance sheets focus on the current activities and performances while income sheets track them over a longer period. Businesses tend to track income statements each quarter to gain better insight into the different financial processes that occur.

Income statements include profits and losses , which is why they are also called P&L statements (Profits & Losses).

The main elements included on the income statement are:

  • Operating revenue – financial data regarding sales of products or services
  • Net and gross revenue – includes the total sales revenue and remaining revenue (after the cost subtraction)
  • Primary expenses – these include general costs, administrative costs, depreciation and selling, and COGS (cost of goods sold)
  • Secondary expenses – capital loss, asset loss, debt interest, and loan interest
  • Nonoperating revenue – this is revenue that comes from accrued interest, it includes investment returns, capital gains, and royalty payments

Even though shareholder’s equity is usually included on the balance sheet, larger companies tend to report these activities on a separate statement.

This statement tracks the amount of money key stakeholders invest in the business. The investments most commonly include company stocks and securities. After dividends are released to stockholders, the retained earnings in the company change.

Stakeholder equity statement includes these key components:

  • Retained earnings after dividends and losses have been subtracted
  • Common/preferred stock sales
  • Purchased treasury stock
  • Generated income (including the income that comes from unrealized capital gains)

Pro Tip: How to Stay on Top of the Financial Health of Your Business

Do you own and manage a small business? Then you know how much of a struggle it can be to stay on top of the financial health of your business on a daily basis. Now you can pull data from QuickBooks and HubSpot’s CRM to track your key business metrics in one convenient dashboard, including:

  • Open deals and deal amounts by pipeline stage. Get sales data directly from your HubSpot CRM and track deals, deal amounts, deal stages, and dates from your sales pipeline. 
  • Key financial data. Track gross profit margin, open invoices by amount and by customer, paid invoices, expenses, and income from QuickBooks.

Now you can benefit from the experience of our HubSpot CRM and QuickBooks experts, who have put together a plug-and-play Databox template that helps you monitor and analyze your key financial metrics. It’s simple to implement and start using, and best of all, it’s free!

hubspot_quickbooks_financial_overview_dashboard_preview

You can easily set it up in just a few clicks – no coding required.

To set up the dashboard, follow these 3 simple steps:

Step 1: Get the template 

Step 2: Connect your HubSpot and Quickbooks accounts with Databox. 

Step 3: Watch your dashboard populate in seconds.

Financial reports help you understand your company’s financial performance, attract potential investors, and are legally required. This is why you have to make sure that they are as accurate as possible.

You want your financial reports to be comprehensive, understandable, and precise.

Even though creating a good financial report can be very complex, we are going to show you a step-by-step guide that will make the whole process much easier.

Follow these steps to create a great financial report:

Step 1 – Make a Sales Forecast

Step 2 – create a budget for expenses, step 3 – create a cash flow statement, step 4 – estimate net profit, step 5 – manage assets and liabilities, step 6 – find the breakeven point.

When making a sales forecast, the first thing you should do is create a spreadsheet that includes your sales performance from the last three years.

Use a specific section for each line of sales and organize columns for each month of year one. For years two and three, organize columns on a quarterly basis.

Create three different blocks – one for pricing, one for unit sales, and the third one for multiplying units by unit cost (to calculate the cost of sales).

Cost of sales is important because it helps you calculate a precise gross margin.

Once you do the math, you can make an accurate sales forecast that is backed up by historic financial data.

PRO TIP: If you are using HubSpot CRM to visualize your sales data, watch the video below to learn how to set up and track your HubSpot CRM data in order to more accurately forecast your sales this month, quarter, and beyond.

Once you have made a sales forecast, you will want to calculate how much it will cost you.

When creating an expense budget, you should include both fixed costs (rent, payroll, etc.) and variable costs (marketing and promotional expenses). Costs such as interest and taxes can’t be completely accurate, so you are going to have to make rough estimates.

For taxes, you can multiply the estimated debt balance by your estimated tax percentage rate.

To estimate interest, multiply your estimated debt balance by an estimated interest rate.

We already mentioned what cash flow statements are and why they are so important for your business. They are typically created based on the sales forecast, balance sheet components, and other estimates.

To make cash flow estimates, companies should use historical financial statements. If your business is relatively new, you should project cash flow statements by breaking them down into 12 months.

Your way of invoicing is also linked to cash flow estimates.

For example, if a customer has the right to pay for your services after 30 days, the cash flow statement will show that you only collected 80% of your invoices within the month (while you need 100% to cover the expenses).

To estimate net profit, you should use the numbers from your sales forecast, expense estimates, and cash flow statement.

You can calculate the net profit by subtracting expenses, interests, and taxes from the gross margin .

This step is extremely important since it serves as a profit and loss statement that helps you create a detailed business forecast for the next three years.

In order to estimate your business’s net worth at the end of a fiscal year, you have to be able to manage assets and liabilities that won’t be shown in the profits and loss statement.

Come up with a rough estimate of how much money you expect to have on hand each month and include accounts receivable, inventory, land, and equipment.

After that, calculate liabilities, debts from outstanding loans, and accounts payable.

You know that you have found a breakeven point if your business expenses are in line with the sales volume.

The three-year income estimation should help you acquire this analysis. In viable businesses, the total revenue should exceed total expenses.

For potential investors, this kind of information is crucial since they want to be reassured that they are investing in a company with steady growth.

Nowadays, most companies use different tools and templates to make their reporting process easier. Using dashboards can help you track the metrics you obtain from the financial management tools that your business integrates.

Databox offers pre-built financial templates that can help you track the most important financial metrics in one place.

With our comprehensive dashboards, you can follow the most significant numbers and later include them in your financial report, making the whole process less time-consuming.

We understand that each business is different, which is why you can also customize the reports in any way you deem fit and at any time.

Here are some of our most popular financial reports that you can try out:

  • Quickbooks Profit and Loss Overview Dashboard

Xero Profitability Overview Dashboard

Stripe (mrr & churn) dashboard, profitwell revenue trends dashboard, paypal (account overview) dashboard, quickbooks profit and loss overview dashboard.

To gain valuable insight into the sales and expenses that incur in your business, you can use the QuickBooks Profit and Loss Overview Dashboard .

Make sure you are staying on top of your numbers by tracking monthly, quarterly, and yearly income. Also, this report will help you figure out how profitable your company is and which areas may need to be fixed.

Some of the key metrics you can follow are net profit, income by month, expenses by month, and profit margin.

QuickBooks Profit and Loss Overview Dashboard

Xero is one of the most popular accounting systems that companies use to manage their financial positions. However, it can sometimes be hard to organize the large amount of data this tool provides.

This is where the Xero Profitability Overview Dashboard can come in handy. This customizable template will provide you with a comprehensive view of the sales and expenses that go into your Xero system.

Once the time comes for creating a financial report, you can simply integrate the data you gathered in this dashboard.

The key metrics it includes are net profit, income by month, expenses by month, profits, losses, gross profit, and other income.

Xero Profitability Overview Dashboard

Use the Stripe Dashboard to monitor your churn rate and track MRR growth in real-time. Also, you can check how many customers your business currently has at any given time.

Once you connect your Stripe account to this template, you will be able to answer these questions:

  • How much money did I make through sales today?
  • How can I track my MRR (Monthly Recurring Revenue)?
  • How many active customers do we have?
  • How much revenue did I lose from churned customers?

Some of the metrics you can visualize are churn rate goal, customer churn rate, gross volume, revenue churn, and customers.

Stripe (MRR & Churn) Dashboard

Profitwell Revenue Trends Dashboard allows you to monitor all the incoming sources of revenue for your SaaS business and keep track of the important churn metrics.

You can use this free template to see how fast your business is growing. The SaaS metrics will all be located in one comprehensive dashboard and you can visualize all the data with only one click.

Also, you can compare revenue from upgrades and downgrades and investigate your churn ratio revenue.

Profitwell Revenue Trends Dashboard

The PayPal Account Overview Dashboard is extremely useful for bigger companies who want to have a clear overview of their payments, refunds, sales, and other key metrics that your business relies on.

Connecting your PayPal account to the template can be done in a matter of minutes and you will get the answers to questions such as:

  • How can I track gross sales?
  • What is the best way to calculate net sales?
  • How much did I spend on PayPal fees in the previous month?
  • How can I check my PayPal account balance?
  • How much money was returned through refunds last month?

PayPal (Account Overview) Dashboard

Streamline Financial Reporting with Databox

Since the financial reports you create will be examined by both government agencies and potential investors, you will want to make sure that they are top-notch.

However, the reporting process can sometimes feel a bit overwhelming and you will face a lot of pressure trying to create the perfect report.

Databox can help relieve this stress and enhance your financial reporting skills.

No matter if you create these financial statements quarterly or annually, you will end up with a handful of data to analyze. With financial reporting software such as Databox, this analysis process will become both simpler and quicker.

With our customizable dashboards, you can visualize all the most important data and gather it in one place. Aside from being visually pleasing, your reports will also be much more engaging and minimize any chances of error since the information will be imported directly from your financial management tools.

To satisfy both your company’s key stakeholders and potential partners, you can sign up here for a free trial and put your financial reporting on autopilot.

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  • How To Conduct Financial Market Research Like a Pro

How To Conduct Financial Market Research Like A Pro

financial research report example

Financial services providers need to integrate financial market research into their business strategy. This research supplies providers in this vertical with meaningful insights on their target market, market products, and services.

Moreover, this data grants and gives financial services providers a framework for decision-making. As these institutions have to deal with money, there’s a lot at stake for banks and money lending companies. 

In 2019 alone, the global financial services industry spent an estimated $50 billion extracting raw data to support their trading activities and transactions. 

This is because financial market research data enables them to forecast and analyze any trends or aspects of the organization that needs changes. Not only this, market research offers opportunities for investments that increase the profits for an organization.

Even in 2020, when the pandemic brought the entire world to a standstill and disrupted the global economy, financial market research helped finance leaders and the financial services industry to support the economy’s financial recovery. 

The Rising Importance Of Financial Services Industry

As aforementioned, the financial services industry is the main driver of a country’s economy, mainly dominated by large organizations. With a strong financial services sector, the nation’s economy grows, and the consumers earn more, thereby increasing their purchasing power.

The uncertainty brought about by the global pandemic means that potentially every company and organization is likely to make smart and bold financial decisions. Unlike the financial crisis of 2008, the 2020 pandemic has disrupted all aspects of the economy. This means that finance leaders and the financial services industry are strategically positioned to support the economy’s financial recovery. 

With the recent changes in technologies, the rise of new investment trends, and the significant shift in consumer behavior, financial services companies are forced to tap into valuable information to approach these changes. 

Moreover, companies need to leverage relevant data and insights to make the most of these opportunities to keep up with the recent digitization and innovation in the financial services industry. 

This means that market research is as crucial for the finance sector as any other industry. 

The Importance of Conducting Financial Market Research 

financial research report example

Financial markets play a crucial role in driving a country’s economy and offering countless opportunities for investors to tap into specific markets and services. But with changing regulatory demands and consumer requirements, financial services companies and organizations need unique insights to keep up with this changing industry.

Financial market research is essential because it can help break down market data and trends into a broader context that offers finance companies a clear perspective of the risks and benefits of a particular service.

Therefore, several financial services providers invest in data analytics and market research to gain valuable information about their customers. 

However, conducting accurate research is not easy. Lenders, bankers, real estate brokers, and all other kinds of financial services providers need to know precisely what kind of information will help them in decision making. 

For commercial banks and investment companies, market research is essential as it determines which business proposition can benefit them in the long run. Moreover, it helps brokerage firms assess which products are in demand by their customer base so that they can suggest them based on the individual requirements of their customers.

The following expounds on  why a financial market analysis is important for banks and other businesses for their decision-making process:

Reduced Business Risks

When it comes to investing money, businesses need to know the right time to invest. With financial market research, they can predict the value of their investment to reduce business risks. Developing a financial plan that outlines all the risks and benefits that a firm may incur can give financial services providers an idea of which opportunities to invest in. 

Understanding these trends is also important so firms know exactly how to respond to market changes. Some frequent research areas for financial services providers include: 

  • Business Banking 
  • Personal Loans  
  • Property Management

Effective Forecasting And Analysis

Accurate financial forecasting is crucial for financial service providers to strategize in the face of any uncertainties that may affect their business. Thus, financial market research equips businesses and institutions in their strategic planning process . 

This kind of research also provides deep insights into customer behavior and market shifts due to external factors and variations in market trends. With thorough finance market research, supported with effective survey campaigns , businesses can tap into what their customers are doing to offer something unique that sets them apart in the industry.

 It enables financial service institutions to set realistic and feasible goals and helps them predict their annual budgets. 

Accurate Demographic Targeting

To know their ideal demographic, businesses need effective financial market research to assess their target market and what they require from their business. This kind of research is also useful for understanding the distribution of consumer spending over a particular period and how customers feel about their financial situations. 

Financial service providers should inquire of their target market as such : are its members willing to make financial deals with your business at this time of crisis? How have their spending and saving plans changed?

Adequate financial research will delve into all these behaviors and trends at length to help institutions make better decisions. It also provides insights into demographic spending trends, where customers look for financial guidance and receptivity to media. 

Internal Audit Assistance

Businesses can evaluate the trading activities, existing credits, and regulatory reports for a successful internal audit by assessing financial market conduct.

The interconnectedness within the financial system has made it necessary for institutions to analyze their vulnerability to systemic risk s by assessing and analyzing macro-economic factors, industry trends, changes in regulations, risks materializing at other entities, and innovation by peers.

Carrying out an internal audit for a company offers a detailed report on the market’s existing and predicted financial risks . The interconnectedness of different industries and systematic risks in the economy brought about by the pandemic have made it imperative for financial services providers to put forward a dynamic audit plan. And the only way an audit plan will be successful in pointing out a company’s vulnerabilities is with adequate financial market research . 

How To Conduct  Financial Market Research

financial research report example

The following are two foremost methods for conducting financial market research:

Primary market research methods for the finance industry

Primary market research for the finance industry involves the direct participation of financial services providers in the research. It offers valuable data on different market areas that providers may require, as obtaining firsthand data provides them with unique insights , particularly their study. This is of utmost importance as secondary research providers do not provide data into the particular inquiries and topic s of study that a financial services provider seeks. 

Some of the methods to conduct primary market research for the finance industry include:

  • Interviews – Financial services providers can hold interviews with industry participants to ask questions that require deep understanding. This is important to assess the changing preferences of clients for different financial services
  • Observations – This is a qualitative, no-interaction technique used by financial advisors that can help them gain useful insights regarding the practices followed by finance companies, their competitors, and customer trends
  • Email surveys – Financial advisors can contact industry participants and get feedback through a survey that includes short questions. These responses can then be analyzed and compiled as a report to understand market trends
  • Online Surveys – They prove to be an essential tool within market research techniques as they collect data and insights on the exact amount of respondents to use in a survey pool. Online surveys can also support a company’s decision-making processes and offer them a competitive advantage through fast quality data. By accessing the right platform for generating online surveys, the financial services providers access qualitative and quantitative surveys.

Secondary market research methods for the finance industry

Secondary market research for the finance industry relies on data and information that researchers extract, meaning that the data has already been conducted by a third party and made available. 

Some of the methods to conduct secondary market research include:

  • Industry Reports – Industry reports identify any opportunities or risks that the industry might face and present scenarios from the past that can help financial advisors deal with threats in a better way 
  • Case Studies – Case studies illustrate how industries dealt with financial crises in the past and can provide a detailed, in-depth investigation into a complex situation. They are perfect for providing you with real-life examples of industries and actionable insights
  • Statistics sites – Statistical research can help you decide which data collection methods would garner maximum results, what decisions to make, and how to predict behavioral response based on past statistical reports
  • Research papers – Research papers provide in-depth knowledge on a particular topic that helps financial services providers understand and make better decisions
  • Research agencies – Research agencies know all the proper tactics for conducting market research. They can help financial advisors with information such as client preferences, the right target market, predicting future financial conditions, etc

However, the type of research method financial advisors choose depends highly on time and available data. Qualitative market research like interviews and participant observation offers detailed, rich information and takes some time to collect. On the other hand, surveys and online feedback are easy to collect and lack necessary details. 

Secondary Market Research For The Finance Industry

The following is the list of the best secondary market resources on important data and insights on the finance industry.

  • Business Insider – Financial Services Industry Overview  

It offers a general overview of the financial services industry, from money management to digital banking technologies. Also, it outlines all the major trends, topics, and behaviors needed for companies to climb up the ladder in the financial sector. 

  • MarketResearch. Com – Financial Market Research Reports and Industry Analysis

Includes reports on the latest financial market research and provides analytical data on different financial subjects such as insurance management and consumer spending/saving patterns.

  • IBIS World – Finance and Insurance Industry in the US

Compiled by IBIS World, this website is a massive database of thousands of industries. It presents useful information on economic changes, demographic data and helps organizations make better financial decisions. 

  • MarketsAndMarkets – Banking and Financial Services Market Research Reports and Consulting

This website provides press releases, publications, and reports on banking and financial services. Given the devastating impact of the pandemic on the financial sector, the reports on MarketsAndMarkets also offer strategic, tactical advice on using financial services to help companies recover from their losses. 

  • The Business Research Company – Financial Services Global Market report

The Business Research Company is the most authentic report on the internet that provides detailed reports on different industries in the market. It presents past trends and how markets have changed in the past decade and predicts statistical information on financial services providers. 

Financial market research enables the finance industry to gain meaningful insights into different products and services. This increases sales opportunities and offers businesses all the information they need to design effective financial strategies. 

Carrying Out Effective Research in the Financial Sector  

Online surveys are the most convenient method for collecting data owing to their accessibility and accuracy. This is why financial services providers need to leverage the power of an online survey platform or market research experts so that they can target a vast audience base and generate reliable survey responses.

To improve data quality, advanced online surveys leverage machine-learning to highlight and eliminate poor quality responses. AI in market research reduces the chances of error and eliminates duplicate entries of data that might result in outdated information and poor data quality. 

These online surveys are then used in random device engagement sampling (RDE)to engage a huge customer base on devices they are already using. Whether these surveys are posted on mobile apps or gaming interfaces, they are placed where the business’s audience can easily respond to them. This way, they can tap into unique and high-quality market research data that drives their decision-making process. 

Frequently asked questions

What is financial market research.

Financial market research offers useful insights into financial trends and strategies and gives statistical information on the leading finance companies. It also provides actionable insights regarding various financial instruments like portfolio pricing, risk management, etc.

Why do businesses need to conduct financial market research?

Financial market research minimizes the risk for financial services providers and identifies new business opportunities for them. It also gives them insights into market trends, identifies problem areas in the market and untapped resources.

How can an online survey platform help businesses with financial market research?

Online surveys are a reliable way of getting insights directly from consumers. They are also affordable and require minimal to no investment.

What are some of the resources to find secondary research on the finance market?

Secondary market research sources include the web, media sources, industry reports, case studies, press releases, publications, and company compiled data.

Do businesses need a financial advisor?

Even though many business owners choose to conduct their research, financial advisors can offer a solid, strategic plan that takes all their previous, present, and future investments into account and provide them with the most feasible plan. Moreover, financial advisors are experienced in their job and know a lot more about financial market trends than business owners that can help in effective decision making.

Do you want to distribute your survey? Pollfish offers you access to millions of targeted consumers to get survey responses from $0.95 per complete. Launch your survey today.

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How to Write a Financial Report

Last Updated: August 23, 2023 Fact Checked

This article was co-authored by Michael R. Lewis . Michael R. Lewis is a retired corporate executive, entrepreneur, and investment advisor in Texas. He has over 40 years of experience in business and finance, including as a Vice President for Blue Cross Blue Shield of Texas. He has a BBA in Industrial Management from the University of Texas at Austin. This article has been fact-checked, ensuring the accuracy of any cited facts and confirming the authority of its sources. This article has been viewed 384,361 times.

A financial report is an informational document about the financial health of a company or organization, which includes a balance sheet, an income statement and a statement of cash flows. Financial reports are often reviewed and analyzed by business managers, boards of directors, investors, financial analysts and government agencies. Reports must be prepared and disseminated in a timely manner, and they must be accurate and clear. Although creating a financial report may seem daunting, the accounting required is not all that difficult.

Preparing to Write

Step 1 Decide on a time frame.

  • To determine the period of time your financial report should cover, review the governing documents of your organization, such as the bylaws, corporate charter or articles of incorporation. These documents may describe how often the financial report should be prepared.
  • Ask an executive at your organization how frequently reports are expected to be prepared.
  • If you are the executive of your own organization, consider when the financial report would be most useful to you and select that as your financial report date.

Step 2 Review your ledgers.

  • For example, make sure all accounts payable and receivable have been processed, verify that the bank reconciliation is complete, and ascertain whether all inventory purchases and product sales have been recorded.
  • You'll also need to consider any liabilities that may be unrecorded as of the financial report date. For example, has the company received any services that have not been invoiced? Are employees owed wages that have not yet been paid? These items represent accrued liabilities and must be recorded in the financial statements.

Step 3 Gather any missing information.

Preparing the Balance Sheet

Step 1 Set up the balance sheet page.

  • The balance sheet items are reported as of a specific day of the year. For example, the balance may be prepared as of December 31.

Step 2 Format your balance sheet appropriately.

  • Start with current assets, such as cash and any items that will be converted to cash within one year of the balance sheet date. At the end of this section, include a subtotal of the current assets. [2] X Research source
  • Next, list the non-current assets. Non-current assets are defined as any assets that are not in the form of cash and will not be converted to cash any time soon. For example, property, equipment and notes receivable are non-current assets. Include a subtotal of the non-current assets.
  • Finally, sum the current and non-current subtotals and label this line “Total Assets.”

Step 4 List your liabilities.

  • Begin by listing current liabilities. These are liabilities that are due within one year, and typically include accounts payable, accrued liabilities and the short-term portion of mortgages and other loan payments. Include a subtotal of the current liabilities. [3] X Research source
  • Next, include the long-term liabilities. These are any liabilities that will not be settled within one year, such as long-term debt and notes payable. Include a subtotal of long-term liabilities.
  • Sum the current and non-current subtotals and label this line “Total Liabilities.”

Step 5 List all sources of equity.

  • Here, make a list of all the equity accounts, such as common stock, treasury stock and retained earnings. Once all the equity accounts are listed, sum them and add the caption “Total Equity.”

Step 6 Add up the liabilities and equity.

  • Shareholder's equity should correspond to a company's assets minus its liabilities. As mentioned previously, this is the money that would be left over if all assets were sold and all liabilities paid. Hence, liabilities plus equity should be equal to assets.
  • If the balance sheet does not balance, double check your work. You may have omitted or miscategorized one of your accounts. Double check each column individually and make sure everything is included that ought to be. You may have missed a valuable asset, or a significant liability.

Preparing the Income Statement

Step 1 Set up the income statement page.

  • For example, an income statement is often drafted for the period from January 1 to December 31 of a particular year.
  • Note that it is possible to prepare a financial report for a single quarter or month, while your income statement might be for a full year. Your financial report will be easier for readers to understand if they are for the same period, but this isn't strictly necessary.

Step 2 List sources of revenue.

  • Be sure to report each type of revenue separately, adjusted as necessary for any sales discounts or return allowances, for example: “Sales, $10,000” and “Service Income, $5,000.”
  • Organize the sources of revenue in a way that is meaningful to the company. Some options may be revenue by geographical region, by management team or by specific product.
  • When all revenue sources have been included, sum them and report the total as “Total Revenue.”

Step 3 Report the costs of goods sold.

  • To calculate a cost of goods, you should add the direct materials, direct labor, factory costs and shipping or delivery expenses. [7] X Research source
  • Subtract cost of goods sold from total revenue and title this number “Gross Profit.” [8] X Trustworthy Source U.S. Securities and Exchange Commission Independent U.S. government agency responsible for regulating the securities industry, which includes stocks and options exchanges Go to source

Step 4 Record operating expenses.

  • Subtract the sum of these costs from your gross profit and title this number “Profit Before Taxes.”

Step 5 Include retained earnings.

  • Adding retained earnings from the beginning of the year to the current year's net income or loss results in the total retained earnings balance.

Preparing a Statement of Cash Flows

Step 1 Set up your cash flows statement page.

  • Similar to the income statement, the statement of cash flows covers a period of time, such as January 1 to December 31.

Step 2 Create an operating activities section.

  • List the operating activities of the organization. This may include items such as cash receipts from sales and cash paid for inventory. Subtotal these items and label the resulting total “Net Cash Provided by Operating Activities.”

Step 3 Create an investing activities section.

  • This section relates to cash paid or received from investments in property and equipment, or investments in securities, such as stocks and bonds. [10] X Trustworthy Source U.S. Securities and Exchange Commission Independent U.S. government agency responsible for regulating the securities industry, which includes stocks and options exchanges Go to source
  • Add a subtotal called “Net Cash Provided by Investing Activities.”

Step 4 Include financing activities.

  • This section should shows inflows and outflows from securities and debt issued by the organization. [11] X Trustworthy Source U.S. Securities and Exchange Commission Independent U.S. government agency responsible for regulating the securities industry, which includes stocks and options exchanges Go to source Add a subtotal called “Net Cash Provided by Financing Activities.”

Step 5 Sum up the categories.

  • You can add the increase or decrease in cash to the cash balance at the beginning of the period. The sum of these two numbers should equal the cash balance shown on your balance sheet.

Step 6 Add any important notes or narrative.

  • The notes might contain information about company history, future plans or industry information. This is your opportunity to explain to investors what the report means and what it shows or doesn't show. It can help potential investors see the company through your eyes. [12] X Trustworthy Source U.S. Securities and Exchange Commission Independent U.S. government agency responsible for regulating the securities industry, which includes stocks and options exchanges Go to source
  • Typically, the notes also include an explanation of accounting practices and procedures used by the company and explanations of balance sheet captions.
  • This section also often includes details about the company's tax situation, pension plans, and stock options.

Expert Q&A

Michael R. Lewis

  • Refer to the Generally Accepted Accounting Principles (GAAP) for additional help in preparing financial reports. GAAP is the standard for accountants and financial professionals in all businesses and industries. [13] X Research source Thanks Helpful 0 Not Helpful 0
  • If you are having trouble preparing your financial report, look up the financial report of a company that operates in the same industry as your organization. You may be able to take away valuable insights about how to format your report. The Securities and Exchange Commission's website publishes financial statements for a variety of different companies. [14] X Trustworthy Source U.S. Securities and Exchange Commission Independent U.S. government agency responsible for regulating the securities industry, which includes stocks and options exchanges Go to source Thanks Helpful 0 Not Helpful 0
  • Remember to use clear labels for each entry in the balance sheet and on the income statement. The information should be clear to a reader of the financial statements who is not familiar with the specifics of your company. Thanks Helpful 0 Not Helpful 0

financial research report example

  • The professional regulations governing financial statements and footnotes are extensive. Consider consulting a Certified Public Accountant or other financial services professional for additional help with your financial report to make sure your report has been prepared properly and legally. Thanks Helpful 0 Not Helpful 0

You Might Also Like

Write an Income Statement

  • ↑ https://online.hbs.edu/blog/post/how-to-prepare-a-balance-sheet
  • ↑ http://www.sec.gov/investor/pubs/begfinstmtguide.htm
  • ↑ http://www.accountingtools.com/questions-and-answers/how-to-calculate-the-cost-of-goods-sold.html
  • ↑ http://www.investopedia.com/terms/g/gaap.asp
  • ↑ http://www.sec.gov/

About This Article

Michael R. Lewis

To write a financial report, format a balance sheet that lists assets, liabilities, and equity. Combine the totals for each category and include the final total at the bottom of the sheet. Next, create an income statement page to list revenue, cost of goods sold, operating expenses, and retained earnings, then sum those categories. Lastly, create a cash flows statement page to compile operating, investing, and financing activities and include a sum at the bottom. For tips on preparing and organizing your data before writing the report, read on! Did this summary help you? Yes No

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11 Examples Of Financial Reports You Can Use For Daily, Weekly & Monthly Reports

Financial reports by datapine

Table of Contents

1) What Is A Financial Report?

2) Types Of Financial Reports

3) Annual Financial Report Example

4) Monthly Financial Reports Examples

5) Weekly Financial Report Templates

6) Daily Financial Report Examples

7) Why Do You Need Financial Reports?

8) Challenges Of Financial Reports

9) How To Make A Financial Report?

Regardless of your sector or industry, it’s likely that your finances department is the beating heart of your entire operation. Without financial fluency, it’s difficult for an organization to thrive, which means that keeping your monetary affairs in order is essential.

As a business, you need the reliability of frequent business financial reports to gain a better grasp of the status of your finances, both current and future. In addition to empowering you to take a proactive approach concerning the management of your company’s economy, these tools help assist in increasing long-term profitability through short-term company financial statements.

A robust finance report communicates crucial accounting information that covers a specified period, such as daily, weekly, and monthly. These are powerful tools that you can apply to increase internal business performance. A data-driven finance report is also an effective means of remaining updated with any significant progress or changes in the status of your finances and helps you measure your results, cash flow, and overall profitability.

Here, we will look at these kinds of tools in greater detail, delving into daily, weekly, and annual reports but focusing mainly on monthly financial reports and examples you can use for creating your own, which we will present and explain later in the article alongside their relevance in today’s fast-paced, hyper-connected business world.

What Is A Financial Report?

Financial report example showing the profit and loss status of a company

A financial report or financial statement is a management tool used to communicate the performance of key financial activities efficiently. With the help of interactive KPIs, businesses can ensure steady growth and revenue while staying compliant with law and tax regulations.

As you can see in the example above, created with a professional financial business intelligence solution, a modern finance report can have all the relevant information right at your fingertips, offering the ability to visualize as well as analyze key data; they assist in uncovering fresh insights, spotting key financial trends, identifying strengths as well as weaknesses, and improving communication throughout the organization. We will explore even more examples of monthly statements later in the article.

We live in a data-driven age, and the ability to use financial insights and metrics to your advantage will set you apart from the pack. Online reporting tools to do that exist for that very purpose. To gain a panoramic view of your business’s financial activities, working with an annual, monthly, weekly, and daily financial report template will give you a well-rounded and comprehensive overview of every key area based on your specific aims, goals, and objectives.

Your organization needs these tools to help support certain objectives and enable you to provide useful information to investors, decision-makers, and creditors, especially if you work as a financial agency and need to create an interactive client dashboard . But not only, as it can also support your business in determining the following:

  • If you can effectively generate cash and how that cash is used.
  • To reveal specific business transaction details.
  • To follow the results of your finances so you can identify potential issues that are impacting your profitability.
  • Develop financial ratios that show the position of your business.
  • Evaluate if your company can pay off all of your debts.

Daily reports, however, have a limited impact, as most of the financial KPIs that are used need mid-to-long-term monitoring and do not provide accurate information if analyzed only on a daily basis.

This is why we still mention them and provide examples of what can be tracked and analyzed every day, but for a long-term view, you should take a look at our annual, weekly, and monthly reports. The monthly ones are on top, illustrated with beautiful data visualizations that provide a better understanding of the metrics tracked.

Equipped with financial analytics software , you can easily produce these daily, weekly, monthly, and annual reports. They will provide your company with the insights it needs to remain profitable, meet objectives, evaluate your decision-making processes, and keep everyone in the value chain on track.

Your Chance: Want to test financial reporting software completely free? We offer a 14-day free trial. Benefit from great financial reports today!

Types Of Financial Reports

As stated above, finance statements are fundamental tools for businesses not only to track their performance and report to investors but also to stay compliant with law regulations that obligate them to respond to certain guidelines. That said, there are three major types, and we will cover them in detail below! 

Balance Sheet

A balance sheet is a statement that provides detailed information about a company’s assets, liabilities, and equity. Or in other words, what a company owns, owes, and is invested by shareholders. Balance sheets should portray the bigger picture of a business's financial health during a particular date. There is no mandatory frequency to generate balance sheets; some organizations prepare monthly statements, while others can do quarterly or annual ones. Let’s see each of the elements in more detail below. 

  • Assets : The items your company owns that can provide future economic benefits. This can be from cash to furniture or equipment. 
  • Liabilities : It is basically what your company owes to others. They can be divided into long-term liabilities, such as the lease of your office building or a bank loan, or short-term liabilities, which can be your credit card debt or wages to employees. 
  • Equity : It represents the shareholder’s stake in the company . To calculate the shareholders’ equity, you need to subtract the total liabilities from the total assets. This calculation is based on the general accounting equation formula: Assets = Liabilities + Shareholders' Equity. Equity is used in many different ratios, such as ROA and ROE.

An important note regarding this type of statement is that it should always be balanced, hence the name. Your total assets should always equal the total liabilities and shareholder’s equity. If this is not the case, then there must be something wrong, and it needs to be looked into. Another consideration when it comes to balance sheets is always to compare them to other similar businesses, as they will vary depending on the industry.  

Income Statement

As its name suggests, the income statement portrays the revenue generated from sales as well as all the operating expenses involved in generating that income. Essentially, how much you made and how much you spent. While a balance sheet provides a snapshot of a business's monetary health at a specific point in time, an income statement shows the profitability of a business over an accounting period (month, quarter, or year).  

Also known as profit and loss, this is a fundamental document for any business as it not only tracks performance but it needs to be presented to the fiscal authorities to ensure compliance with law regulations. The income statement focuses on 4 key elements: revenue, expenses, gains, and losses. 

  • Revenues : The revenue can be divided into operating and non-operating. On one hand, the operating one includes all income related to primary activities such as selling a product or service. On the other hand, the non-operating one is related to non-core business activities such as income from interest earned on capital lying in the bank or rental income from the business property. 
  • Gains : Essentially, gains measure the money made from other activities that are non-business related and that are a one-time-only thing. For example: selling an old machine or unused land. 
  • Expenses : All costs related to core operations. Just like revenue, expenses can be divided into primary and secondary. Primary expenses are all the ones linked to the operating revenue, while secondary ones are linked to non-operating revenue. 
  • Losses : All expenses that cost the company to lose assets. They are unusual one-time costs, such as lawsuit expenses.  

The bottom line of the income statement is the Net Income which is basically the profit of the observed period. The net income is calculated with the following formula: Net Income= (Revenue + Gains) - (Expenses + Losses) 

Cash Flow Statement 

Last but not least, the cash flow statement (CFS) portrays how much money entered and left the business during a particular time period. It basically measures how well the company manages to generate cash to pay debt obligations and cover operating expenses. While an income statement can tell you whether a company made a profit, the cash flow can tell you if it made cash. The CFS is a fundamental document for investors as it helps them understand the liquidity of a company and make informed investment decisions. 

Usually, CFS is divided into three main sections: operating activities, investing activities, and financing activities. Let’s see them in more detail. 

  • Operating activities : This refers to any sources or uses of cash from regular business activities such as sales of goods and services, interest payments, salary for employees, and tax payments, just to name a few. 
  • Investing activities: This includes any sources or uses of cash from investments which can include purchases or sales of assets, loans made to vendors, and others. 
  • Financing activities: This includes sources or uses of cash from investors and banks, such as dividends, payments for stock repurchases, and loans. 

Now that we have a better understanding of the definition and types, we are going to take a closer look at financial statements examples of daily, weekly, monthly, and annual reports and their associated KPIs. These examples will help your organization tick over the right way . Let's get started.

Annual Financial Report Example

We are hitting things off with the annual financial report. As its name suggests, these statements monitor the performance of a business for the duration of a year. They can include anything from a balance sheet, income statement, and CFS, as well as predictions for the coming year. Now we will look at an example of an interactive annual dashboard in the shape of an income statement comparing the actual vs. forecasted performance of an organization. 

Annual financial report example of an actual vs forecast income statement dashboard

**click to enlarge**

Financial forecasting is the process of using predictive analytics technologies to generate accurate predictions about future performance. This is done by analyzing a mix of historical and current data and finding patterns that can help organizations make better decisions. 

Our template above, generated with a modern dashboard maker , does just that. It starts by providing detailed information about the three most important metrics in an income statement: revenue, costs, and net profit. Each of them is displayed on a gauge chart with the actual value compared to a forecasted value, paired with the absolute and percentage difference between the two values. This way, users can quickly identify when something is lacking in performance compared to what was expected from it. 

The value of this high-level tool is the fact that it provides three months forecast based on the past 12 months performance. This allows managers to efficiently plan their strategies based on the expected costs and revenues. The dashboard also provides a breakdown of each of these metrics to analyze each element in detail. For instance, by looking at the past 6 months of the revenue breakdown chart, we can see that this business has not been reaching the forecasted amount, which means something might be going on that needs to be looked at. On the other hand, we can see that costs for marketing are slightly higher than expected, which can also be something to look into and see if these costs are justified.

Monthly Financial Reports Examples & Templates

Monthly financial reports are a management way of obtaining a concise overview of the previous month’s status to have up-to-date reporting of the cash management, profit, and loss statements while evaluating future plans and decisions moving forward.

These financial reporting examples offer a more panoramic view of an organization’s economic affairs, serving up elements of information covered in our daily and weekly explanations. By offering the ability to drill down into metrics over a four-week period, the data here is largely focused on creating bigger, more long-term changes, strategies, and initiatives.

These powerful documents offer detailed visual insights into the following areas:

  • Cash management: A comprehensive overview of your organization’s liquidity and existing cash flow situation.
  • Profit and loss: A critical glimpse into your company’s income statement and profits in a number of critical areas of the business.
  • The bigger picture: A business financial report format offers a full overview of the company’s core financing activities over a monthly period, providing data geared towards developing sustainable strategies and improvements that will foster growth and increased profitability.

Coupled with the insights delivered by daily and weekly reports, monthly ones in the form of online dashboards are pivotal to not only gaining an edge on your competitors but also getting a predictive vision that will ensure you meet – and even exceed – your financial targets indefinitely. As a result, your overall efficiency will become flawless, and you’re likely to enjoy healthy growth in your year-on-year profits.

There is a wealth of KPIs to consider when looking at a monthly financial report sample. The best way to explain them in a practical context is by getting visual.

To help you understand how you can benefit from all of this, here are 5 monthly report examples, complete with explanatory insight and a deeper insight into their respective KPIs.

These interactive financial reports examples demonstrate the detail and insight you can gain from your online data analysis if you use it in the right way.

a) Cash Management Financial Report Template And KPIs

Our first example of a financial report provides you with a quick overview of your liquidity and current cash flow situation. Good management of cash flow is fundamental for success since a healthy cash flow means that the company has enough money to pay salaries and debts and invest in growth opportunities. However, bad management can lead to the end of a business since no cash means no operations. This example is critical to keeping your finances flowing across the organization and predicting future outcomes that will help you to stay always ahead of your finances.

Monthly financial report example: cash management dashboard

The first portion of this dashboard examines the current ratio, which is simply the ratio between your current assets and liabilities. This metric demonstrates the flexibility your company has in immediately using the money for acquisitions or to pay off debts.  A really healthy current ratio would be about 2 to ensure your company will be able to pay current liabilities at any time and still have a buffer. Alongside this metric is the quick ratio, which is similar to the current ratio, except it takes into account only the near-cash assets, meaning all assets that you can convert into cash quickly, such as equipment or furniture. This means your quick ratio will always be lower than your current ratio. By monitoring these metrics, you can understand at a quick glance if your business is liquid or not. 

Next, the cash management dashboard goes more in detail into the situation of a business with two financial graphs visualizing the current accounts payable and receivable for a year, this way you can stay on top of your expenditures and money to be collected and avoid having future issues that will affect your liquidity. 

Current ratio: Core indication of a business’s short-term financial health, as well as indicating if you’re promptly collecting Accounts Due.

  • This metric is measured by dividing debt and accounts payable by cash inventory and accounts receivables.

Quick ratio: As mentioned above, this metric only takes into account the short-term assets that you can turn into money within 90 days, like your accounts receivable. The higher the ratio, the healthier the liquidity of your business. Your goal should always be to keep your quick ratio at a minimum of 1,0. 

Accounts payable turnover ratio: This shows how quickly your organization pays off suppliers and other bills. It also shows the number of times your company can pay off the average accounts payable balance during a certain time period.

  • For example, if your company purchases 10 million goods in a year and holds an average account payable of 2 million, the ratio is 5.
  • A higher ratio shows suppliers and creditors that your company is on top of paying its bills.

b) Profit And Loss Financial Reports Examples And KPIs

Moving on with our list of financial reporting templates, the P&L dashboard gives a clear overview of the income statement, from the income earned to the final net profit; the whole is enhanced by relevant performance ratios.

An income statement, also known as a P&L, is one of the most powerful examples as it gives you a detailed snapshot of your company's financial performance and tells you how profitable your business was in a specific period of time.  

Monthly financial report example showing the OPEX, EBIT, income statement, etc

The dashboard above is a perfect example of a financial statement for P&L. First, we see the income statement that starts by calculating the gross profit, which is obtained by subtracting your total revenue from your COGS. Next, we have a list of operating expenses (OPEX) that include sales, marketing, and other general administration costs. The total OPEX is then subtracted from the gross profit to reach the operating profit (EBIT). Finally, the total amount of interest and taxes are subtracted from the EBIT, resulting in the final net profit of the business. By doing these simple calculations, you can quickly see how profitable your company is and if your costs and income are being managed properly. 

Additionally, the dashboard provides a glance at performance percentages of the main metrics of the income statement: gross profit, OPEX, EBIT, and net profit. This can be further utilized to find month-to-month trends in your expenses and prepare ahead of time for months in which your expenses will be higher. 

It is important to consider that an income statement will not tell you more detailed information about your finances, such as how much money your company has in total or how much debt you have. For this purpose, there is another type of document called a balance sheet, and we will see it in more detail in our next financial statement example. 

Operating profit margin (EBIT): It allows your business to monitor how much profit you are generating for each dollar of income. This metric is also referred to as “EBIT” for “earnings before interest and tax.”

  • This metric measures how profitable your business model is and shows what’s leftover of your revenue after paying for operational costs.
  • It doesn’t include revenue earned from investments or the effects of taxes.

Operating expense ratio: This monthly example indicates the operational efficiency of your business through the comparison of operating expenses and your total revenue.

  • Essentially the lower your operating expenses, the more profitable your organization is.
  • These KPIs are particularly helpful in benchmarking your company against other businesses.

Net profit margin: Measures your business’s profit minus operating expenses, interest, and taxes divided by total revenue.

  • It’s one of the most closely monitored financial KPIs. The higher the net profit margin, the better.

COGS: The Cost of Good Sold is the total amount of money it costs you to produce your product or service. If your COGS and your revenues are too close, that means you are not making a lot of gains on each sale. 

  • Separating COGS from operating expenses is a fundamental step, as it will tell you if you are overspending your revenues in operational processes. 

c) Financial Performance Report Template And KPIs

This particular financial statement template provides you with an overview of how efficiently you are spending your capital while providing a snapshot of the main metrics on your balance sheet.

Just like the income statement, a balance sheet is another powerful tool for understanding the performance of your business. As we see in the dashboard below, a balance sheet is divided into three main areas: assets, liabilities, and equity. 

Alongside the balance sheet, the dashboard displays four other important metrics: the ROA, WCR, ROE, and DER. These four KPIs give you an immediate picture of trends in how your company’s assets are being managed. Good management of your assets and healthy equity will bring new investors to your business and will prevent you from facing disasters for unexpected losses, or bankruptcy.  

Monthly financial report template: a balance sheet is a good overview of the assets and debts of your company at a specific moment

Return on assets (ROA): This shows how profitable your businesses are compared to your total assets. Assets include both debt and equity.

  • This is a critical metric to any potential investors because it shows them how efficiently management is using assets to generate earnings.

Return on equity (ROE): Calculates the profit your company generates for your shareholders. It is used to compare profitability amongst businesses in the same industry.

  • This is measured by dividing your business’s net income by your shareholder's equity.

Debt equity ratio (DEB): This metric measures how much debt you are using to finance your assets and operations in comparison to the equity available. It is obtained by dividing the total liabilities by the stakeholder’s equity. 

d) Financial KPI Dashboard And KPIs

This financial report format created with a professional dashboard designer offers a broad overview of your business’s most critical economic activities, operating with KPIs that are developed specifically to answer vital questions on areas such as liquidity, invoicing, budgeting, and general accounting stability. A template that you can apply to almost every business across industries, this incredibly insightful tool is pivotal to maintaining a healthy, continually evolving financial profile. Let’s look at the KPIs linked to this most valuable example.

Financial statements example to calculate working capital and current ratio

Working capital: A key performance indicator focused on financial stability, this metric will help you monitor your performance based on your company's assets and liabilities.

  • In the context of this financial report format, working capital is vital as it will help you accurately gauge your business’s operational efficiency and short-term health.

Quick ratio/acid test: A KPI that offers instant insights as well as results, this metric serves up critical information concerning liquidity.

  • The quick ratio/acid test is worth tracking – by measuring these particular metrics, you’ll be able to understand whether your company is scalable and, if not – which measures you need to take to foster growth.

Cash conversion cycle: Your cash conversion cycle (CCC) is a critical metric for any organization as it drills down into key areas of your company’s operational and managerial processes.

  • Tracking your CCC with visual BI reporting tools is incredibly useful as it provides a quantifiable means of knowing the length of time it takes for your business to convert its inventory investments, in addition to other resources, into cash flows from sales.
  • A steady, consistent CCC is generally a good sign, and if you spot noticeable fluctuations, you should conduct further analysis to identify the root of the issue.

Vendor payment error rate: Every business – including yours – works with third-party vendors or partners, and managing these relationships as efficiently as possible is critical to any organization’s ongoing financial health. That’s where the vendor payment error rate KPI comes in.

  • By gaining an insight into potential errors or efficiencies relating to the payment of your vendors, you’ll be able to improve financial flow and efficiency while nurturing your most valuable professional relationships.
  • If your vendor error rate is high, you will know that procurement inefficiencies exist, and you’ll be able to take appropriate action to improve your processes and avoid potential disputes.

Budget variance: Budgeting is one of the cornerstones of corporate financial health. This powerful KPI from this most critical financial report sample serves to express the difference between budgeted and genuine figures for a particular accounting category.

  • Offering a quick-glance visualization of whether particular budgets are on track in specific areas and departments, this KPI allows you to get a grasp of variances between proposed and actual figures while obtaining the information required to make vital changes in the appropriate areas.
  • Keeping your budget expectations and proposals as accurate and realistic as possible is critical to your company’s growth, which makes this metric an essential part of any business’s reporting toolkit.

e) Financial Statement Example For CFOs

Next, we look into a financial performance report focused on data relevant for CFOs that need to grasp high-level metrics such as revenue, gross profit, operating expenses, net income, berry ratio, EVA, payroll headcount ratio, and, finally, to build a strong team and customer base, satisfaction levels of each. This financial management report example will not only serve as a roadmap for depicting the monetary health of a company but also focus on team management and customer satisfaction, which are not traditional finance-related metrics but are important in this case for every modern CFO. This example shows the YTD until March, but it can also be used as one of our monthly financial statements examples. We will explain the KPIs in more detail below:

A financial report template showing key metrics such as revenue, gross profit, cost breakdown, berry ratio, payroll headcount ratio, etc.

Berry ratio: This ratio is defined between gross profit and operating expenses (costs). This financial indicator is critical when showing if the company is generating a healthy amount of profit or losing money.

  • When calculating the berry ratio, usually external income and interest aren't included, but depreciation and amortization could be, depending on the particularities of your strategy.
  • An indicator over 1 means that the company is making a profit above all expenses, while a coefficient below 1 will indicate that the company is losing money.

Economic value added (EVA): Referred to as the economic profit of a company, EVA is a critical element to include in any finance report template as it will show the surplus profit over the WACC (weighted average cost of capital) demanded by the capital market.

  • By gaining insights into the potential surplus and how profitable a company's projects are, the management performance can be reflected better. Moreover, it will reflect the idea that the business is profitable only when it starts to create wealth for its shareholders.
  • Succinctly speaking, the financial statement should include EVA as it will show how much and from where a company is creating wealth.

Cost breakdown: This particular metric is extremely important in any finance department since costs are one of the financial pillars of an organization, no matter how large or small. Every organization needs to know where the costs are coming from in order to reduce them and, consequently, positively affect performance.

  • If you see that most costs come from administrational activities, you should consider automating tasks as much as possible. By utilizing self service analytics tools , each professional in your team will be equipped to explore and generate insights on their own without burdening other departments and saving countless working hours.
  • Generally, costs should not be looked upon purely on the basis of black and white. If sales and marketing cause cost increment, maybe they also deliver high volumes of income so the balance is healthy and not negative.

Satisfaction levels: C-level managers need to prepare financial analysis reports with satisfaction levels in mind. These indicators are not purely financial, but they do influence economics and can cause potential bottlenecks.

  • If the financial team has a lower satisfaction level, you need to react fast in order to avoid potential talent loss that can cause the company serious money. Keeping the team satisfied by conducting regular feedback talks, and offering career progression and competitive salaries, for example, can only affect the business in positive ways since the motivation will rise as well as the quality of the working environment. In this case, you can also connect to an HR dashboard and follow the team's performance and satisfaction levels in more detail.
  • If customers are unsatisfied, it can also cause damages from outside your team that can, consequently, influence financial performance. For this reason, customer service analytics should also be an important aspect to be covered in your CFO report .

The above example of financial statement is not only focused on pure numbers, as you can see, but also on the human aspect of team and customer management that every modern CFO needs to take into account in order to benefit strategies and deliver economic growth.

f) Financial Report Template For Operating Expenses

Last but not least, on our list of monthly financial statement examples, we have a template that focuses entirely on operating expenses analysis.  Operating expenses also referred to as OpEx, are all expenses that companies incur through their day-to-day operations. Such as rent, equipment, inventory, salaries, insurance, materials, marketing, sales, and much more, depending on the industry. It is fundamental for businesses to track their OpEx closely and regularly as they directly affect profitability. An organization that manages to keep its OpEx at a minimum while still maintaining profitability and efficiency stands to gain a massive competitive advantage. 

Our example below will help you do just that by providing a complete overview of the development of your OpEx on a month-to-month basis. Let’s explore it in detail below. 

Financial report for operating expenses analysis

* *click to enlarge**

The value of this template lies in its level of detail. Traditional income statements track all OpEx together without differentiating between fixed and variable ones. Making it harder to extract deeper conclusions from the data. Our OpEx report above differentiates fixed and variable expenses and shows the monthly development of both compared to the performance of the previous year. This way, users can extract valuable conclusions to improve their strategies and overall financial performance. For instance, by looking at the OpEx development chart on the top, we can see that, overall, both fixed and variable expenses are higher compared to the benchmark. This can be because the company is producing more goods and services, which would result in higher costs or something else that needs to be looked into in more detail. 

To do so, you can take a look at the operating ratio and net profit margin development chart. These are the success indicators that will help you understand if your cost-optimization strategies are paying off. There, we can observe a positive development in previous months with a decrease in the last observed period. Again, this could either be expected or something to be alarmed. It is important to take a deeper look into the data to ensure no big insights remain untapped. 

If you are still feeling a bit lost about the KPIs shown in this example, let’s talk about them in detail below. 

  • Variable expenses : These are costs that are directly related to a business’s production levels. Meaning they can increase or decrease regularly, hence, the name variable. They include costs such as raw materials, labor costs, distribution and shipping, packaging, and sales commissions, among others. It is important to note that variable expenses can not be compared to any other company as they vary from industry to industry. 
  • Fixed expenses : As its name suggests, these are all expenses that need to be mandatorily paid every month, quarter, or year. They are not subjected to the production level but more to the functioning of the business. These include salaries, insurance, rent, and taxes, just to name a few. 
  • Operating ratio : This KPI shows your operating expenses as a percentage of the total revenue. It shows the ability of an organization to keep costs low while generating revenue. This means the lower the ratio, the more profitable the organization is.

Weekly Financial Report Templates And KPIs

A weekly financial statement serves to help you monitor all your short-term financial activities in weekly increments. It should be created and reviewed each week and provides a comprehensive look at the short-term performance of your business.

Now we will take a look at some financial statements examples to get a clearer picture of what can be tracked in weekly intervals.

a) Operating Cash Receipts, Disbursements, Balance

Part of a business’s budgeting process may include cash receipts and disbursements, which use actual data for cash collection to design a budget or create income statements, for example. A sample financial report on a weekly basis can help companies gain insights from accurate reporting based on using cash receipts and disbursements. Metrics and KPIs can include:

Cash flow: indicates the changes in cash versus its fixed counterparts, such as exactly where cash is used or generated during the week.

  • Operating activities: measures a business’s operating cash movements, whereby the net sum of operating cash flow is generated.
  • Financing activities: tracks cash level changes from payments of interest and dividends or internal stock purchases.
  • Investing activities: tracks cash changes derived from the sale or purchase of long-term investments, like property, for example.

Operating activities: indicated any activities within a business that affect cash flows, such as total sales of products within a weekly period, employee payments, or supplier payments.

  • Direct method: This metric obtains data from cash receipts and cash disbursements related to operating activities. The sum of the two values = the operating cash flow (OCF).
  • Indirect method: This metric uses the net income and adjusts items that were used to calculate the net income without impacting cash flow, therefore converting it to OCF.

Gross profit margin: This enables your business to measure and track the total revenue minus the cost of goods sold, divided by your total sales revenue.

  • This KPI is a crucial measurement of production efficiency within your organization. Costs may include the price of labor and materials but exclude distribution and rent expenses.
  • For example, if your gross profit margin were 30% last year, you would keep 30 cents out of every dollar earned and apply it towards administration, marketing, and other expenses. On a weekly basis, it makes sense to track this KPI in order to keep an eye on the development of your earnings, especially if you run short promotions to increase the number of purchases. Here is a visual example:

Weekly financial report example showing the gross profit margin in a gauge chart

b) Any Generated Current Receivables

Weekly financial reports can help businesses stay on top of invoicing, billing procedures, cash basis of accounting, and accounting records, and ensure that they don’t fall behind on being paid for services and goods that are owed to them by customers or suppliers. Weekly report metrics and KPIs include:

  • Days sales outstanding (DSO): This measures how fast your business collects money that you’re owed following a completed sale. DSO = (Accounts receivable/total credit sales) x number of days in the period.
  • DSO vs. best possible DSO: Aligning these two numbers indicates the collection of debts in a timely fashion. Best possible days sales outstanding = (Current receivables x number of days in a week) / weekly credit sales.
  • Average days delinquent: Indicates how efficient your business processes are in your ability to collect receivables on time. ADD= Days sales outstanding – Best possible days sales outstanding

Top Daily Financial Report Examples And KPIs

A daily financial report is a method to track the previous day’s activities that have an impact on your accounting status but are not necessarily a strict financial metric. It can keep you apprised of all the requisite data management used to track and measure potential errors, internal production, revenue loss, and receivables' status.

As we mentioned above, these ones provide a limited vision, but you can use the examples below to see how some daily actions on problematic factors can impact your final results.

a) Tracking Potential Staff Errors

Maintaining an efficient, productive work environment and ensuring that you can identify any employee discrepancies or issues is critical to being proactive about business growth. Monitoring employees working hours and productivity levels can help you detect potential staff errors quickly, control these errors, and avoid negative impacts on your financial results at the end of the day and, ultimately, the month.

Real-time management live dashboards offer clear visuals regarding employee management processes with the following metrics and KPIs:

Organizational performance: These are key metrics for tracking and evaluating some factors impacting your performance.

  • Employee overtime: overtime per employee = total overtime hours / FTE
  • Absenteeism: Number of employees absent today

Work quality: These metrics help companies determine the quality level of their employees’ work performance.

  • Amount of errors
  • Product defects

Work quantity: These metrics indicate employee performance related to quantity, such as sales figures or the number of codes a programmer can create in a given amount of time. Quantity does not, of course, mean quality, but on monitored daily, it can reveal bottlenecks or under-production problems.

  • Sales numbers: the number of client contacts, the number of calls an employee makes, and the amount of active sales leads.
  • Units produced: lines produced during coding, number of keys a nurse receptionist can hit per minute, etc.
  • Customer handling time: how many customer calls are answered during a specific time period, for example.

b) Measure Revenue Loss & Receivables

By tracking staff errors, you can track the money it costs your company (having a problem in production, finding the problem, and fixing it), which will inevitably end up in your financial statements as the money you lost. Tracking revenue loss can be especially beneficial for those companies with customer accounts or recurring income. A daily record helps businesses quickly monitor revenue-related factors so that they can increase their earnings. Revenue loss can also originate from one-time purchases, customers who move to your competitor, or customers who move out of the area. Metrics used to measure these factors can include: 

Accounts receivable turnover ratio: This measures the number of times that your business is able to collect average accounts receivable and indicates your effectiveness in extending credits. Here is a visual example:

Daily financial report example showing the accounts receivable turnover on a pie chart

  • A low accounts receivable turnover ratio basically indicates that you might need to revise your business's credit policies to collect payments more quickly.

Additional metrics you can monitor on a shorter time frame, such as daily, are as follows:

  • Number of daily transactions
  • Average gross margin
  • The average cost per order

You can also be more specific about your revenue loss: categorizing where you lost what a good practice to identify which parts of your business management reporting practices have important room for improvement is. Tracking metrics like the top 10 products generating the most revenue or, on the contrary, the top 10 products generating the worse revenue will tell you a story about what needs more attention.

The revenue loss can also come from discounts or sales, for example. Monitoring on a daily basis which promotions are getting “too” popular can help you stop it before it generates more revenue loss than revenue growth that was supposed to create.

A daily, weekly, and monthly record help communicate the ongoing narrative of your company's economic processes, strategies, initiatives, and progress. As you can see, this form of an analytical report in the finance industry is an undeniably potent tool for ensuring your company’s internal as well as external financial activities are fluent, buoyant, and ever-evolving.

Why Do You Need Financial Reports?

Why do you need financial reports?: 1. Financial performance tracking, 2. Tracking errors, 3. Showing financial condition, 4. Debt management, 5. Staying compliant with tax laws

We saw some powerful financial statement templates to empower your business, but before finishing our journey through these tools, we are going to show you some of the main ways in which your business could benefit from them. As we mentioned a few times through this article, interactive reports created with professional business analytics tools offer a clear snapshot of your business’s financial health, and they will give you the answers you need to plan strategies and tackle any issues that might arise with your finances. Here are the top 5 benefits. 

  • Performance tracking: If you are a loyal reader of this blog, then you know the importance of relying on data for business success. By using modern financial performance reports, CFOs, and other relevant stakeholders can have a quick and accurate snapshot of all areas of a business. This will help them make more informed decision-making as well as plan strategies and forecast future results to find growth opportunities. 
  • Mitigating errors: When we are talking about finances, every detail counts. Using inaccurate statements can not only damage your business’s profitability but can also expose it to legal issues if any discrepancies are found in your numbers. Many BI finance tools in the market ensure accurate reporting with the latest data available. This way, you will be able to constantly monitor the performance of your finances in every area and mitigate any errors before they become bigger issues.  
  • Showing financial condition to investors and stakeholders: If you have investors or you are looking for potential ones to expand your business, then a report showing a snapshot of your business performance will be a fundamental tool. On one hand, it will help you show your investors where their money went and where it is now, and on the other, it will show potential new investors or other relevant stakeholders that your business is worth their money.
  • Debt Management: As we mentioned in one of our examples of financial statements, wrong debt management can damage a business to the point of no return. Investing in innovative BI solutions to generate professional statements that contain a detailed balance sheet of your assets and liabilities can help you understand your liquidity and manage your debts accordingly.  
  • Staying compliant with tax laws: Last but not least, one of the most important benefits of using finances reporting is to stay compliant with the law. No matter the size of your company, you have to pay taxes, and tax agents will use your financial documents to make sure you are paying your fair amount. By keeping track of this information in a professional financial status document, you will be able to reduce your tax burden and avoid any discrepancies in your numbers. 

Common Challenges Of Financial Statements

While these tools are fundamental to the growth and correct functioning of any type of organization that profits, it is still a hard process that has limitations. Being aware of the challenges coming your way can help you tackle them and be prepared to generate accurate financial statements. Let’s look at some of these limitations. 

  • Manual work : Manual tasks are the enemy of a successful reporting process. Especially with finances, where you need to make important decisions all the time, the need for real-time reporting is critical. However, there are still many companies that build their statements manually, which means by the time it is ready, the data is no longer useful. With that issue in mind, several automated reporting tools have emerged to help mitigate the manual tasks and dedicate more time to actually analyzing.  
  • Manage various data sources : Data quality is the basis of a successful reporting process. When it comes to generating finance reports, it is necessary to gather data from various sources, which can be a tedious job. The issue becomes even bigger when you want to process and unify all of this information for analysis. Luckily, modern management reporting tools allow you to connect various data sources and visualize them all together in interactive dashboards with just a few clicks.  
  • Data literacy: Data literacy refers to the ability to understand, communicate and work with data. It represents a challenge for any reporting process, but especially when it comes to finances, as the numbers and concepts are more complex. To prevent literacy levels from becoming a bigger issue, it is recommended to assess the level of knowledge across employees and departments and provide financial and data-related training for anyone who needs it. This way, you’ll ensure everyone is on the same page and has the ability to integrate analytical practices into their daily operations. 
  • Accessibility and collaboration : It is very likely that an organization’s financial goals will be linked across departments and teams. Achieving these goals successfully requires a level of collaboration that is harder to achieve, especially when it comes to sharing reports and building discussions around them. If these documents are not properly shared, it is very possible that discrepancies will be found in the strategies, and that can damage the end goal. To avoid this, organizations need to rely on analytical tools with an online environment that allows them to easily share relevant information among different stakeholders in a fast and efficient way.  
  • Adapt to regulatory changes : Paired with the challenges coming with the data management process, there are also regulatory changes that happen all the time, and that can present a challenge for organizations. Businesses need to ensure their financial reports are rigorously complying with regulations as well as be flexible and responsive to any new changes that might arise. 
  • Security : With cyberattacks and data breaches becoming an increasing concern for businesses, keeping financial data secure becomes a major challenge for organizations. To prevent your information from ending up in the wrong hands, it is necessary to implement various security measures such as access controls, password-protected reports, and other things.  

How To Make A Financial Report?

How to make a financial report: tips and best practices by datapine

To create a comprehensive financial statement, you need to keep these points in mind:

1. Define your mission and audience

No matter if you're a small business or a large enterprise, you need to define your goals clearly and what you are trying to achieve with the report. This can help both internal and external stakeholders who are not familiarized with your company or finances. If you're creating an internal report just for the finances department, it would make sense to include financial jargon and data that, otherwise, would create challenges for external parties to follow.

By defining the mission and audience, you will know how to formulate the information that you need to present and how complex the jargon will be. Create a draft of the most important statements you want to make, and don't rush with this step. Take your time; the numbers, charts, and presentations come later.

2. Define goals and targets

Once you’ve defined your mission and the audience of your reports, it is time to set some goals and targets to use as benchmarks to measure the success of your financial strategies. This is an important step because goals help organizations plan their expected growth and improve based on that. 

That said, there are a few steps you should follow to ensure you are setting accurate objectives. For starters, your goals and targets should be long and short-term but, most importantly, attainable. Many businesses fail in their analytical efforts because they take industry benchmarks, for example, as the end goal for their own performance. Now, while industry values are good benchmarks and they shouldn’t be discarded entirely, they should still be looked at with a grain of salt. Be honest with yourself and with the current scenario of your business, and define targets that are realistic and attainable. Consider your budget, your business size, your historical performance, and other elements to build efficient goals that are measurable in time.  

3. Identify your metrics

In this step, you need to identify the key performance indicators that will represent the financial health of your company and help you measure the goals you defined in the previous step. Depending on the selected metrics, you will need to present the following:

Balance sheet: This displays a business’s financial status at the end of a certain time period. It offers an overview of a business’s liabilities , assets, and shareholder equity.

Income statement: This indicates the revenue a business earned over a certain period of time and shows a business’s profitability. It includes a net income equal to the revenues and gains minus the expenses and losses.

Cash flow statement: Details a business’s cash flows during certain time periods and indicates if a business made or lost cash during that period of time.

These financial statements will help you get started. Additionally, you might want to consider specific KPIs and their relations. Gross profit margin, operating profit margin, operating expense ratio, etc., all have different applications and uses in a relevant data story. Take your time to identify the ones you want to include in order to avoid multiple repeats afterward.

4. Choose the right visualizations

Continuing on our previous point, after specifying the financial statement and metrics you want to add, it's time to include visuals. This point is important since the average reader will struggle to digest raw data, especially if you work with large volumes of information.

The type of chart is important to consider since the visuals will immediately show the relationship, distribution,  composition, or comparison of data. Therefore, the type of charts will play a significant role in your reporting practice. Here is a visual overview that can help you identify which one to choose:

Overview to use the right data visualization types for comparisons, compositions, relationships and distributions

In the overview, we can see that scatter plots and bubble plots will work best in depicting the relationship of the data, while the column chart or histogram is the distribution of data. To learn more about a specific chart and details about each, we suggest you read our guide on the top 30 financial charts .

5. Apply design best practices 

By now, you have the planning of your report ready. The next step is to bring everything to life by generating the actual report. Choosing the right chart type is the first step, but there are other design best practices that should be followed to ensure the process is as efficient as possible. 

The first and most important best practice is to avoid overcrowding your reports. Putting too much information in them will make everything confusing and harder to understand, which can translate into poor strategic decisions for the future. Prioritize the most important KPIs that enable you to tell a story about your performance as well as some context to make sense of the information. Arrange your charts in a way that makes sense, and that helps the audience understand everything. 

Another important design best practice is to think carefully about colors. While it is very tempting to use a different color for every KPI, it is not recommended to do this. You should stick to only a few colors that are not too strong. You can even use different shades of the same color to differentiate data points, as you saw in our examples section. It is also a good practice to use your business’s color palette to make it more personalized and familiar to the audience. 

6. Use interactive features 

Traditionally, finance reporting has been a static practice that mainly contained outdated data that was not entirely valuable. As you’ve learned throughout this post, this is no longer the case. Today, these reports contain a mix of real-time and historical insights that enable decision-makers to extract insights and act on them as soon as they occur. Part of the success of this modern approach relies majorly on interactivity. That is why our next best practice or tip is to integrate interactive features into the process. 

Tools such as datapine offer a range of interactive functionalities to integrate into your financial reports. For instance, you can add different tabs with extra information and have it all together in a single report. This way, you’ll avoid overcrowding the report or having to generate multiple different ones. Plus, if you need to visit another tab quickly, you have the option to link that tab to a specific KPI and be transferred to it just by clicking on the chart. 

Another interactive feature that makes the reporting process way more efficient is drill downs and drill throughs. They basically enable users to go into lower or higher levels of data, respectively, without the need to jump into another chart. For example, if you are looking at revenue by country but want to dig deeper into a specific country, you can click on it, and the chart will adapt to show revenue by city of that country. The same thing can be done upwards to look at revenue by continent. 

7. Use modern software & tools

To be able to manage all your finance reports effectively, you will need professional tools. The traditional way of reporting through countless spreadsheets no longer serves its purpose since, with each export, you manage historical data and don't have access to real-time insights. The power of a modern dashboard builder lies within the opportunity to access insights on the go, in real-time, and with refreshing intervals that you can set based on your needs.

Moreover, professional dashboard software comes with built-in templates and interactivity levels that traditional tools cannot recreate or offer in such simplicity but, at the same time, a complexity that will make your report more informative, digestible, and, ultimately, cost-effective.

To manage financing performance in comparison to a set target, you can also use a modern KPI scorecard . That way, you will not only monitor your performance but see where you stand against your goals and objectives.

8. Automate your financial management report

Automation plays a vital role in today's creation of company financial reports. With traditional reporting, automation within the application is not quite possible, and in those scenarios, professionals usually lose a lot of time since each week, month, quarter, or year, the report needs to be created manually. Automation, on the other hand, enables users to focus on other tasks since the software updates the report automatically and leaves countless hours of free time that can be used for other important tasks.

For example, you can schedule your financial statement report on a daily, weekly, monthly, or yearly basis and send it to the selected recipients automatically. Moreover, you can share your dashboard or select certain viewers that have access only to the filters you have assigned. Finally, an embedded option will enable you to customize your dashboards and reports within your own application and white label based on your branding requirements. You can learn more about this point in our article, where we explain in detail the usage and benefits of professional white label BI and embedded analytics.

9. Stay Compliant

We already mentioned the regulatory side of financial reporting a couple of times throughout this post, but it is such an important step that we could not leave it out of this list. That is because companies that fail to meet the governmental requirements for their finance statements can face critical consequences that will throw all other efforts down the drain. 

In this sense, there are different requirements depending on the country or continent. In the USA, companies need to adhere to the GAAP guidelines, which basically provide a set of rules and standards for entities to prepare their reporting in a consistent and transparent way.  On the other side, countries from the EU need to follow the IFRS rules. Which obligates listed companies to follow a set of rules to prepare their statements. The IFRS guidelines provide a common language used by more than 100 countries. Through that, UE regulators can compare organizations across “international boundaries.”

10. Learn from the process

This might sound like an obvious step, but it is often overlooked. Once you are done generating your financial report, you should gather internal feedback from employees and any other relevant users and learn from the process. There is no secret recipe for the perfect finance report. Each company has different needs and resources. Therefore, tweaking little details to make the process efficient and easier for everyone involved can reap significant rewards in the future.  

As you’ve learned through this list of best practices, these tools are more digestible when they are generated through online data visualization tools that have numerous interactive dashboard features to ensure that your business has the right meaningful financial data. Finally, these statements will give your business the ability to:

  • Track your revenue, expenses, and profitability.
  • Make predictions based on trusted data.
  • Plan out your budget more effectively.
  • Improve the performance of your processes.
  • Create fully customizable reports.

Comprehensive Reports For The Complete Financial Story Of Your Business

We’ve explained how to write a financial report, examined the dynamics of a monthly, daily, and weekly report templates, and explored examples relating to specific areas of the business with their related KPIs as well as some key benefits. Now, it’s time to look at the concept as a whole.

Financial reporting practices help your business obtain a clear, comprehensive overview of where your company is at and where you should plan on going. When augmented with crisp, easy-to-read visualizations in the form of financial dashboards , your business can quickly comprehend and accurately measure critical components of your status over specified time periods.

A financial statement template, as we presented above, can also help you answer critical questions, such as What can your business do with an extra $500k in cash? Will you be able to borrow less money, invest in new technology, or hire trained personnel to improve your sales?

Using datapine’s seamless software, your business will be able to see the full financial story of your company come to life and have a better grasp of your future path.

When it comes to your business’s finances, shooting in the dark or using antiquated methods of analysis or measurement will not only stunt your organizational growth but could lead to mistakes, errors, or inefficiencies that will prove detrimental to the health of your business. Data-driven dashboard reporting is the way forward, and if you embrace its power today, you’ll reap great rewards tomorrow and long into the future.

Do you want to improve your business’s financial health today? Try our 14-day trial completely free!

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What Are Financial Statements?

  • Their Purpose

Balance Sheet

Income statement, cash flow statement, statement of changes in shareholder equity, statement of comprehensive income, nonprofit financial statements.

  • Limitations

The Bottom Line

  • Corporate Finance
  • Financial Statements

Financial Statements: List of Types and How to Read Them

financial research report example

Financial statements are written records that convey the financial activities of a company. Financial statements are often audited by government agencies and accountants to ensure accuracy and for tax, financing, or investing purposes. For-profit primary financial statements include the balance sheet, income statement, statement of cash flow, and statement of changes in equity. Nonprofit entities use a similar but different set of financial statements.

Key Takeaways

  • Financial statements provide interested parties with a company's overall financial condition and profitability.
  • Statements required by Generally Accepted Accounting Principles are the balance sheet, the income statement, and the statement of cash flows, but you'll likely see more in reports.
  • The balance sheet provides an overview of assets, liabilities, and shareholders' equity as a snapshot in time.
  • The income statement primarily focuses on a company's revenues and expenses during a particular period. Once expenses are subtracted from revenues, the statement produces a company's profit figure called net income.
  • The cash flow statement (CFS) tracks how a company uses its cash to pay its debt obligations and fund its operating expenses and investments.

Investopedia / Julie Bang

Understanding Financial Statements

Investors and financial analysts rely on financial data to analyze a company's performance and make predictions about the future direction of its stock price. One of the most important resources of reliable and audited financial data is the annual report , which contains the firm's financial statements.

The financial statements are used by investors, market analysts, and creditors to evaluate a company's financial health and earnings potential. The three major financial statement reports are the balance sheet, income statement, and statement of cash flows.

Not all financial statements are created equally. The rules used by U.S. companies are called Generally Accepted Accounting Principles, while the rules often used by international companies are International Financial Reporting Standards (IFRS). In addition, U.S. government agencies use a different set of financial reporting rules.

The balance sheet provides an overview of a company's assets, liabilities, and shareholders' equity at a specific time and date. The date at the top of the balance sheet tells you when this snapshot was taken; this is generally the end of its annual reporting period. Below is a breakdown of the items in a balance sheet.

  • Cash and cash equivalents  are liquid assets, which may include Treasury bills and certificates of deposit.
  • Accounts receivable  are the amount of money owed to the company by its customers for the sale of its products and services.
  • Inventory is the goods a company has on hand, intended to be sold as a course of business. Inventory may include finished goods, work in progress that is not yet finished, or raw materials on hand that have yet to be worked.
  • Prepaid expenses are costs paid in advance of when they are due. These expenses are recorded as an asset because their value has not yet been recognized; should the benefit not be recognized, the company would theoretically be due a refund.
  • Property, plant, and equipment are capital assets owned by a company for its long-term benefit. This includes buildings used for manufacturing or heavy machinery used for processing raw materials.
  • Investments are assets held for speculative future growth. These aren't used in operations; they are simply held for capital appreciation.
  • Trademarks, patents, goodwill, and other intangible assets can't physically be touched but have future economic (and often long-term benefits) for the company.

Liabilities

  • Accounts payable are the bills due as part of a business's operations. This includes utility bills, rent invoices, and obligations to buy raw materials.
  • Wages payable are payments due to staff for time worked.
  • Notes payable are recorded debt instruments that record official debt agreements, including the payment schedule and amount.
  • Dividends  payable are dividends that have been declared to be awarded to shareholders but have not yet been paid.
  • Long-term debt can include a variety of obligations, including sinking bond funds, mortgages, or other loans that are due in their entirety in more than one year. Note that the short-term portion of this debt is recorded as a current liability.

Shareholders' Equity

  • Shareholders' equity is a company's total assets minus its total liabilities.  Shareholders' equity (also known as stockholders' equity ) represents the amount of money that would be returned to shareholders if all of the assets were liquidated and all debts paid off.
  • Retained earnings  are part of shareholders' equity and are the amount of net earnings that were not paid to shareholders as dividends.

Example of a Balance Sheet 

Below is a portion of ExxonMobil Corporation's  (XOM)  balance sheet for fiscal year 2021, reported as of Dec. 31, 2021.

  • Total assets were $338.9 billion.
  • Total liabilities were $163.2 billion.
  • Total equity was $175.7 billion.
  • Total liabilities and equity were $338.9 billion, which equals the total assets for the period.

Unlike the balance sheet, the income statement covers a range of time, which is a year for annual financial statements and a quarter for quarterly financial statements. The income statement provides an overview of revenues, expenses, net income, and earnings per share.

Operating revenue is the revenue earned by selling a company's products or services. The  operating revenue for an auto manufacturer would be realized through the production and sale of autos. Operating revenue is generated from the core business activities of a company.

Non-operating revenue is the income earned from non-core business activities. These revenues fall outside the primary function of the business. Some non-operating revenue examples include:

  • Interest earned on cash in the bank
  • Rental income from a property
  • Income from strategic partnerships like royalty payment receipts
  • Income from an advertisement display located on the company's property

Other income is the revenue earned from other activities. Other income could include gains from the sale of long-term assets such as land, vehicles, or a subsidiary.

Primary expenses are incurred during the process of earning revenue from the primary activity of the business. Expenses include the cost of goods sold (COGS), selling, general and administrative expenses (SG&A), depreciation or amortization, and research and development (R&D).

Typical expenses include employee wages, sales commissions, and utilities such as electricity and transportation.

Expenses that are linked to secondary activities include interest paid on loans or debt. Losses from the sale of an asset are also recorded as expenses.

The main purpose of the income statement is to convey details of profitability and the financial results of business activities; however, it can be very effective in showing whether sales or revenue is increasing when compared over multiple periods.

Investors can also see how well a company's management is controlling expenses to determine whether a company's efforts in reducing the cost of sales might boost profits over time.

Example of an Income Statement

Below is a portion of ExxonMobil Corporation's income statement for fiscal year 2021, reported as of Dec. 31, 2021.

  • Total revenue was $276.7 billion.
  • Total costs were $254.4 billion.
  • Net income or profit was $23 billion.

The cash flow statement (CFS) shows how cash flows throughout a company. The cash flow statement complements the balance sheet and  income statement .

The CFS allows investors to understand how a company's operations are running, where its money is coming from, and how money is being spent. The CFS also provides insight as to whether a company is on a solid financial footing.

The cash flow statement contains three sections that report on the various activities for which a company uses its cash. Those three components of the CFS are listed below.

Operating Activities 

The operating activities on the CFS include any sources and uses of cash from running the business and selling its products or services. Cash from operations includes any changes made in cash accounts receivable, depreciation, inventory, and  accounts payable . These transactions also include wages, income tax payments, interest payments, rent, and cash receipts from the sale of a product or service.

Investing Activities

Investing activities include any sources and uses of cash from a company's investments in its long-term future. A purchase or sale of an asset, loans made to vendors or received from customers, or any payments related to a merger or acquisition are included in this category.

Also, purchases of fixed assets such as property, plant, and equipment (PPE) are included in this section. In short, changes in equipment, assets, or investments relate to cash from investing.

Financing Activities

Cash from financing activities includes the cash from investors or banks and the cash paid to shareholders. Financing activities include debt issuance, equity issuance, stock repurchases, loans, dividends paid, and debt repayments.

The cash flow statement reconciles the income statement with the balance sheet in three major business activities.

Example of a Cash Flow Statement

Below is a portion of ExxonMobil Corporation's cash flow statement for fiscal year 2021, reported as of Dec. 31, 2021. We can see the three areas of the cash flow statement and their results.

  • Operating activities generated a positive cash flow of $48 billion.
  • Investing activities generated cash outflows of -$10.2 billion for the period. Additions to property, plant, and equipment made up the majority of cash outflows, which means the company invested in new fixed assets.
  • Financing activities generated cash outflows of -$35.4 billion for the period. Reductions in short-term debt and dividends paid out comprised most of the cash outflows.

The statement of changes in equity tracks total equity over time. This information ties back to a balance sheet for the same period; the ending balance on the change of equity statement equals the total equity reported on the balance sheet.

The formula for changes to shareholder equity will vary from company to company; in general, there are a couple of components:

  • Beginning equity : This is the equity at the end of the last period that simply rolls to the start of the next period.
  • (+) Net income : This is the amount of income the company earned in a given period. The proceeds from operations are automatically recognized as equity in the company, and this income is rolled into retained earnings at year-end.
  • (-) Dividends : This is the amount of money that is paid out to shareholders from profits. Instead of keeping all of a company's profits, the company may choose to give some profits away to investors.
  • (+/-) Other comprehensive income : This is the period-over-period change in other comprehensive income. Depending on transactions, this figure may be an addition or subtraction from equity.

In ExxonMobil's statement of changes in equity, the company also records activity for acquisitions, dispositions, amortization of stock-based awards, and other financial activities. This information is useful for analyzing how much money is being retained by the company for future growth as opposed to being distributed externally.

An often less utilized financial statement, the statement of comprehensive income summarizes standard net income while also incorporating changes in other comprehensive income (OCI). Other comprehensive income includes all unrealized gains and losses that are not reported on the income statement. This financial statement shows a company's total change in income, even gains and losses that have yet to be recorded in accordance with accounting rules.

Examples of transactions that are reported on the statement of comprehensive income include:

  • Net income (from the statement of income)
  • Unrealized gains or losses from debt securities
  • Unrealized gains or losses from derivative instruments
  • Unrealized translation adjustments due to foreign currency
  • Unrealized gains or losses from retirement programs

In the example below, ExxonMobil has over $2 billion of net unrecognized income. Instead of reporting just $23.5 billion of net income, ExxonMobil reports nearly $26 billion of total income when considering other comprehensive income.

Nonprofit organizations record financial transactions across a similar set of financial statements. However, due to the differences between a for-profit entity and a purely philanthropic entity, there are differences in the financial statements used. The standard set of financial statements used for a nonprofit entity includes:

  • Statement of Financial Position: This is the equivalent of a for-profit entity's balance sheet. The largest difference is nonprofit entities do not have equity positions; any residual balances after all assets have been liquidated and liabilities have been satisfied are called "net assets."
  • Statement of Activities: This is the equivalent of a for-profit entity's statement of income. This report tracks the changes in operation over time, including the reporting of donations, grants, event revenue, and expenses to make everything happen.
  • Statement of Functional Expenses: This is specific to nonprofit entities. The statement of functional expenses reports expenses by entity function (often broken into administrative, program, or fundraising expenses). This information is distributed to the public to explain what proportion of company-wide expenditures are related directly to the mission.
  • Statement of Cash Flow: This is the equivalent of a for-profit entity's statement of cash flow. Though the accounts listed may vary due to the different nature of a nonprofit organization, the statement is still divided into operating, investing, and financing activities.

The purpose of an external auditor is to assess whether an entity's financial statements have been prepared following prevailing accounting rules and whether any material misstatements are impacting the validity of results.

Limitations of Financial Statements

Although financial statements provide a wealth of information on a company, they do have limitations. The statements are often interpreted differently, so investors often draw divergent conclusions about a company's financial performance.

For example, some investors might want stock repurchases , while others might prefer to see that money invested in long-term assets. A company's debt level might be fine for one investor, while another might have concerns about the level of debt for the company.

When analyzing financial statements , it's important to compare multiple periods to determine any trends and compare the company's results to its peers in the same industry.

Lastly, financial statements are only as reliable as the information fed into the reports. Too often, it's been documented that fraudulent financial activity or poor control oversight have led to misstated financial statements intended to mislead users. Even when analyzing audited financial statements, there is a level of trust that users must place in the validity of the report and the figures being shown.

What Are the Main Types of Financial Statements?

The three main types of financial statements are the balance sheet, the income statement, and the cash flow statement. These three statements together show the assets and liabilities of a business, its revenues, and costs, as well as its cash flows from operating, investing, and financing activities.

What Are the Benefits of Financial Statements?

Financial statements show how a business operates. It provides insight into how much and how a business generates revenues, what the cost of doing business is, how efficiently it manages its cash, and what its assets and liabilities are. Financial statements provide all the details on how well or poorly a company manages itself.

How Do You Read Financial Statements?

Financial statements are read in several different ways. First, financial statements can be compared to prior periods to understand changes over time better. Financial statements are also read by comparing the results to competitors or other industry participants. By comparing financial statements to other companies, analysts can get a better sense of which companies are performing the best and which are lagging behind the rest of the industry.

What Is GAAP?

Generally Accepted Accounting Principles (GAAP) are the rules by which publicly-owned United States companies must prepare their financial statements. It is the guideline that explains how to record transactions, when to recognize revenue, and when expenses must be recognized. International companies may use a similar but different set of rules called International Financial Reporting Standards (IFRS).

Financial statements are the ticket to the external evaluation of a company's financial performance. The balance sheet reports a company's financial health through its liquidity and solvency, while the income statement reports its profitability. A statement of cash flow ties these two together by tracking sources and uses of cash. Together, these financial statements attempt to provide a more clear picture of a business's financial standing.

U.S. Securities and Exchange Commission. " Exxon Mobile Corporation Form 10-K for the Fiscal Year Ended Dec. 31, 2021 ."

  • Valuing a Company: Business Valuation Defined With 6 Methods 1 of 37
  • What Is Valuation? 2 of 37
  • Valuation Analysis: Meaning, Examples and Use Cases 3 of 37
  • Financial Statements: List of Types and How to Read Them 4 of 37
  • Balance Sheet: Explanation, Components, and Examples 5 of 37
  • Cash Flow Statement: How to Read and Understand It 6 of 37
  • 6 Basic Financial Ratios and What They Reveal 7 of 37
  • 5 Must-Have Metrics for Value Investors 8 of 37
  • Earnings Per Share (EPS): What It Means and How to Calculate It 9 of 37
  • P/E Ratio Definition: Price-to-Earnings Ratio Formula and Examples 10 of 37
  • Price-to-Book (PB) Ratio: Meaning, Formula, and Example 11 of 37
  • Price/Earnings-to-Growth (PEG) Ratio: What It Is and the Formula 12 of 37
  • Fundamental Analysis: Principles, Types, and How to Use It 13 of 37
  • Absolute Value: Definition, Calculation Methods, Example 14 of 37
  • Relative Valuation Model: Definition, Steps, and Types of Models 15 of 37
  • Intrinsic Value of a Stock: What It Is and Formulas to Calculate It 16 of 37
  • Intrinsic Value vs. Current Market Value: What's the Difference? 17 of 37
  • The Comparables Approach to Equity Valuation 18 of 37
  • The 4 Basic Elements of Stock Value 19 of 37
  • How to Become Your Own Stock Analyst 20 of 37
  • Due Diligence in 10 Easy Steps 21 of 37
  • Determining the Value of a Preferred Stock 22 of 37
  • Qualitative Analysis 23 of 37
  • How to Choose the Best Stock Valuation Method 24 of 37
  • Bottom-Up Investing: Definition, Example, Vs. Top-Down 25 of 37
  • Financial Ratio Analysis: Definition, Types, Examples, and How to Use 26 of 37
  • What Book Value Means to Investors 27 of 37
  • Liquidation Value: Definition, What's Excluded, and Example 28 of 37
  • Market Capitalization: How Is It Calculated and What Does It Tell Investors? 29 of 37
  • Discounted Cash Flow (DCF) Explained With Formula and Examples 30 of 37
  • Enterprise Value (EV) Formula and What It Means 31 of 37
  • How to Use Enterprise Value to Compare Companies 32 of 37
  • How to Analyze Corporate Profit Margins 33 of 37
  • Return on Equity (ROE) Calculation and What It Means 34 of 37
  • Decoding DuPont Analysis 35 of 37
  • How to Value Private Companies 36 of 37
  • Valuing Startup Ventures 37 of 37

financial research report example

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Top 10 Financial Report Templates with Examples and Samples

Top 10 Financial Report Templates with Examples and Samples

Mayuri Gangwal

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Without accurate and well-presented financial reports, business decision-making is akin to shooting in the dark. Balance sheets, income statements, cash flow statements, and other financial records are all needed to ensure rational, well-informed decisions are made. 

Whether you’re an experienced financial professional or a young entrepreneur, your effectiveness increases when you have these reports as the background. Yet, creating these valuable reports from scratch can be tedious and time-consuming. 

You are better off getting these templates, ready to use, with just use data to be keyed in. On balance, this is a cost-effective way to take better decisions and meet some of the legal and regulatory requirements of running a business as well. 

Each of the templates that SlideTeam offers you is 100% editable and customizable. Each slide captures relevant economic parameters and gives you valuable information about your company's financial health.

You will also learn essential lessons about the best practices for financial reporting, the significance of visual presentation, and how these templates can turn complex data into aesthetically attractive presentations that appeal to stakeholders.

Template 1: Financial Report of Information Technology Company Complete Deck

This PPT Template is an introduction for employees, investors, clients, and partners. It gives them a 360-degree overview of your business, including operations, finances, and gross profit. 

The 52-slide complete deck includes topics such as an overview of the business, its products and services, history, mission, and vision. Apart from this traditional aspect, these slides also cover financial comparisons and strategic details such as long-term objectives, acquisitions, SWOT analysis, and risk management using this slide. Download this presentation template immediately to acquire this powerful tool to deliver a compelling financial report about your IT company.

Financial Report of an Information Technology Company

Download Now

Template 2: Example Presentation of Financial Reports PPT Presentation Slides

Use this presentation template to give your creditors, investors, and analysts a thorough rundown of your company's financial situation so they can judge its viability. You may use this template to make intelligent business decisions by presenting your financial results in an understandable format. Thanks to our practical design, you can visually showcase your financial details. This ensures that you effectively communicate your voice in the competitive market. Use this template to captivate your audience through engaging charts and infographics. Get it now and let your data speak for the health of your business. 

Example Presentation Of Financial Reports

Template 3: Information Technology Company Financial Report

This comprehensive package provides a aesthetically-pleasing slides, themes, forms, and visuals. You can improve audience comprehension and decision-making with this deck, which covers financial statistics, revenue distribution, business expenses, balance sheets, cash flow analyses, income statements, and employee budgets. This adaptable presentation can be customized to suit your business goals and objectives. This deck contains 21 editable slides compatible Google Slides. This gives the user flexibility to use them per their requirements and deliver a lucid presentation. 

Information Technology Company Financial Report

Template 4: Financial Reporting To Measure Company Financial Performance 

This deck is the most effective tool available, with a selection of styled slides leading you to the study of significant topics. Make the presentation unique and thought-provoking by customizing the text and graphics. You can alter and modify each of the 43 slides so that they meet your unique business demands. This PPT design helps businesses provide a transparent view of their financial health to their stakeholders. The in-depth reports provide information on cash flow, earnings, capital, and sales. This presentation encompasses a wide range of slides, covering essential aspects of businesses.  Download this template to analyze your business's performance with ease.   

Financial Reporting to Measure the Financial Performance of a company

Template 5: Financial Reporting to Disclose Related Information To Management PPT Presentation

This PPT Template allows an in-depth examination of sales, expenses, earnings, capital, and cash flow in a structured and visually appealing manner. Our experts’ carefully prepared reports will provide a thorough picture of your company’s financial situation. It includes sales, expenses, earnings, capital, and cash flow. The slides cover in-depth information on the company, essential data, goods, and services. Access this comprehensive deck of 41 slides that are fully customizable by downloading it from our website.  The template provides a straightforward yet all-inclusive approach to communicating financial results and information to management. 

Financial Reporting to Disclose Related Information to Management

Template 6: Healthcare Company Financial Report PPT Template Bundles

Use this presentation report to give more authority and impact to your presentation. This deck has excellent visuals, photos, and icons to emphasize your point. It provides a robust framework for expressing your thoughts and encouraging teamwork. You may also use this template to effectively exhibit many forms of information, such as statistics. Cover gross profit and margin, revenue by regions, yearly comparison of growth across business segments using this PPT Template. Income statement with forecast, and cash flow analysis is also covered. Download this template and elevate your presentation to new heights.

Healthcare Company Financial Report

Template 7: Annual Audited Financial Report PDF Doc, PPT 

We are pleased to present the Annual audited financial report PowerPoint Template, a valuable tool for companies to highlight their financial success. This report thoroughly reviews the business's operations over the year. It is an essential tool allowing businesses to capture prospective investors and other interested parties. Multiple pages of the template include the CEO's message, outlining future corporate governance and operational compliance goals.

The template also covers the financial highlights from the past three to five years, including revenues, EPS, operating cash flow, and EBITDA. Learn to showcase the company’s milestones, business sector analysis, industry trends, vision, purpose, and values. Risk management, financial statements, the global leadership team, corporate governance procedures, and sustainability projects are also part of the template. 

Annual Audited Financial Report

Template 8: Financial Reporting Dashboard Snapshot With Assets and Liabilities

Discover our Financial Reporting Dashboard Snapshot With Assets And Liabilities slides, a powerful resource covering liquidity ratios, working capital ratios, and current liabilities.

This PPT Presentation allows you to tailor it effortlessly to your audience needs. Download now to deliver a convincing and impactful presentation that provides valuable financial insights. This template allows you to examine the key financial measures and statistics. Use this template to learn more about your resources, obligations, and working capital. This allows you to explain your financial information while showcasing your knowledge and thoroughly comprehending the economic situation.

Financial Reporting Dashboard with Assets and Labilities

Template 9: Monthly Financial Report With Budget And Variance

Presenting the Monthly Financial Report with Budget and Variance, this slide showcases metrics such as Compounded Annual Growth Rate (CAGR), profit and loss, balance sheet, revenue, expenses, net income statements, return on assets, cash, current ratio, accounts payable, and accounts receivable. Our premium set of slides simplifies the interpretation of profit-loss and balance sheet metrics.

Monthly Financial Report with Budget and Variance

Template 10: One-Page Business Quarterly Financial Report Presentation Report Infographic PPT PDF

This one-pager pre-developed performance evaluation template helps business owners to evaluate their team's quarterly performance. They can incorporate their company's name and logo to give it a more personalized touch. Using this template, business owners can highlight essential KPIs such as gross profit, net profit, OPEX margin, and operating profit margin visually, to enhance recall and create an impact. Pie-charts are used in this preset. Enjoy the freedom of complete customization regarding colors, diagrams, and fonts. Download this presentation template today to streamline your reporting.

One Page Business Quarterly Financial Report

KNOW YOUR NUMBERS, MAKE BETTER DECISIONS 

These templates are the ultimate financial tools for businesses of all sizes. They allow them to analyze their financial summary more accurately and efficiently, which is crucial to stay ahead in this competitive environment.

Professionals with vast industry experience have designed this template, ensuring that they have a high degree of adaptability and usage. They are user-friendly, customizable, and have rich and compelling visuals, which can help the presenter capture their audience. Choose the template that best suits your needs and elevates your reporting.

FAQs on financial reports

What is an example of a financial report.

A profit and loss statement, alternatively known as an income statement, illustrates a financial report. It is an overview of a company's earnings for a period, usually quarterly or yearly, including revenues, costs, and net income. By displaying a company's capacity to make profits or suffer losses, the income statement aids in evaluating a company's profitability and financial performance.

What are four  types of financial reports? 

The for types of financial reports are

  • The balance sheet
  • The income statement
  • The cash flow statement, and
  • The statement of owner’s equity.

Each of these reflect upon the management of a particular facet of business. A consolidated reading of all is needed to decide, remember. Example, you can have a good cash flow statement, but no profit. Then, it is the top management’s call to interpret these financial statements and take a business path. 

What are the 5 financial reports?

The five financial reports are:

  • Income Statement: Better known as the profit and loss statement, it showcases a company's revenues, expenses, and net income or loss over a specific period.
  • Balance Sheet: It provides a snapshot of a company’s financial position by presenting its assets, liabilities, and shareholders’ equity at a particular time.
  • Cash Flow Statement: This report tracks the inflow and outflow of cash from operating activities, investing activities, and financing activities, offering insights into a company's cash flow management.
  • Statement of Retained Earnings: It outlines the changes in a company's retained earnings, reflecting profits, dividends, and other adjustments over a specific period.
  • Statement of Shareholders' Equity: This report illustrates the changes in shareholders' equity, including contributions, earnings, distributions, and any other modifications, providing a view of the shareholder interests.

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financial research report example

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FinancialResearch.gov

Reports > 2020 annual report to congress.

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Summary: OFR 2020 Annual Report to Congress

With this report, the Office of Financial Research (OFR) presents its assessment of the state of the U.S. financial system, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act). The 2020 Annual Report to Congress fulfills OFR’s requirement to submit a report to Congress within 120 days of the close of the fiscal year (FY). All data cited in this report are as of Sept. 30, 2020, unless otherwise noted.

This report also reflects the OFR’s duty to inform policymakers, regulators, market participants, and the American public about its work to monitor, investigate, and report on changes in systemwide financial stability risk levels and patterns. The OFR’s efforts support sound risk management for the entire financial system. For FY 2020, the report is organized into four main parts:

Assessing Financial Risks in a Turbulent Year

Assessing financial risks and key findings, exploration of information markets, the ofr’s performance.

It has been a decade since the OFR was established and this report is presented during a time of financial and economic uncertainty that is a first for the Office. The OFR’s data, research, and monitoring expertise was well-utilized this year and played an important role in identifying and understanding how stresses within the U.S. financial system during March 2020 interacted with vulnerabilities identified in previous years. Government financial system interventions developed during the 2007-09 financial crisis proved instrumental in moderating the effects of this year’s financial turbulence.

The cause of this year’s financial instability is novel. Within months of the new year, it became clear that the COVID-19 pandemic would be global and trigger devastating health, economic, and financial effects. During March, the medical crisis prompted U.S. state and local government decisions to declare stay-at-home orders and order the shutdown of many businesses. The pandemic and efforts to contain the health threat drastically curtailed economic activity and severely stressed financial markets. On March 9, 12, and 16, the Dow Jones Industrial Average, for example, experienced some of the worst price downturns in its history.

The economy, and even more financial markets, quickly made substantial recoveries with the help of massive government support. The Federal Reserve’s balance sheet ballooned to $7 trillion, by far an all-time high and almost double its size from a year earlier, while federal debt held by the public rose to 95 percent of gross domestic product in FY 2020 from 79 percent in FY 2019.

As this report goes to press, America’s economy has climbed rapidly back from the short but steep COVID-19 recession. And while our economy retraces its way back to trends that characterized the pre-pandemic economy, it will contend with heightened uncertainty and heterogeneous effects across sectors and firms within sectors. Extraordinary government and monetary policy support has gone far to moderate damage to our economy. But while that support helped bridge a period of heightened economic turbulence, it could also risk distortions to competitive markets if maintained too long.

The OFR’s financial stability assessment, combined with key findings from its financial system surveillance, evaluations of system vulnerabilities, data analysis, and research, supports its view that potential risks persist and remain elevated in most of the categories OFR monitors. These areas of risk include macroeconomic, credit, market, liquidity and funding, leverage, insolvency and potential contagion, cybersecurity, and additional risks not included in the other categories. The COVID-19 pandemic increased most, if not all, of these risks.

Despite government actions to stabilize the economy, as well as the finances of firms and households, macroeconomic and credit risks remain high. The pandemic’s course remains uncertain, and thus, so must the economic recovery. Leverage is high among nonfinancial firms, with the potential for severe defaults within the commercial real estate, energy, and high-touch service sectors.

Liquidity and funding risks moderated quickly after the Federal Reserve’s mid-March intervention announcements, while a midyear return to elevated risky-asset valuations heightened market risk. Leverage within the financial sector rose modestly while remaining constrained since the 2007-09 crisis. Insolvency and contagion risks for financial firms appear to be contained while these firms maintain high capital and liquidity buffers.

Cyber risks have continued to grow in volume and sophistication. New vulnerabilities could emerge from increased reliance on remote work, as well as automated systems that strain financial firms’ telecommunications capacity or that operate outside these firms’ control. Natural disasters, the United Kingdom’s exit from the European Union, and the transition from LIBOR to alternative reference rates for financial instruments, also remain potential sources of risk to financial stability.

Traditional approaches to managing systemic risks rely to a considerable extent on regulation, capital requirements, and oversight. People who are charged with enacting these strategies, however, can face political forces that favor distributional preferences over more general opportunity. In addition, they may work at a considerable distance from local knowledge that can help gauge reliance of financiers on each other for funding, the concentration of asset holdings across financiers, and the likelihood that adverse news about one financier’s solvency can encourage runs on another’s liabilities. Top-down approaches to managing systemic risk may thus face tight and hard-to-move constraints against efficiently reducing the possibility, and mitigating the severity, of threats to financial stability.

A market for information about prospects for realizing systemic risks could weaken the incentive for creditors to run on financial organizations. Information markets might also be structured to better evaluate whether proposed or enacted policies and regulations can reduce systemic risks in a cost-effective manner. Finally, this latter type of market could increase transparency about winners and losers from such policies and regulations, and thus help more productive regulations overcome distributional inefficiencies.

OFR promotes financial stability by delivering high-quality financial data, standards, and analysis principally to support the Financial Stability Oversight Council (FSOC) and its members. This year the OFR published its FY2020-2024 Strategic Plan, which consists of two goals: 1) Support the Financial Stability Work of the FSOC and 2) Further Organizational Excellence. The plan is designed to accommodate the changing needs of the OFR’s stakeholders as they address financial vulnerabilities, stress, and even crises, as well as evolving financial business models.

Our performance measures and indicators provided a solid picture of OFR’s progress toward objectives, goals, and mission achievement this year. Highlights include international leadership in cross-border financial data standards and the innovation of several essential data products and initiatives. In 2020, the Legal Entity Identifier (LEI) reached its goal of global preeminence as a high-quality identifier for financial firms. The OFR served on the LEI’s Regulatory Oversight Committee (ROC), which continued to focus on the quality of data that underlies the LEI. This past year, the ROC took on the role of governance for a trio of new financial data standards: the Unique Transaction Identifier (UTI), the Unique Product Identifier (UPI), and the Critical Data Elements for over-the-counter derivatives reporting (CDE).

The OFR’s ability to equip the FSOC and its members with germane data collections, financial stability monitoring services, research insights, and analysis helped address the turbulence of 2020. Among the Office’s online public monitors, the Financial Stress Index (FSI) provided, and continues to produce, daily indicators of financial system stress.

The Office also expanded its monitor offerings in 2020. The U.S. Repo Markets Data Release and the Short-term Funding Monitor were launched during the fourth quarter. Together, they provide new insights into short-term funding, the core of liquidity and maturity transformation in financial markets. Also this year, the Bank Systemic Risk Monitor (BSRM) was upgraded and the Financial Instrument Reference Database (FIRD) entered its initial phase of development.

Years of migrating our Office’s information technology to the cloud, and furthering significant system advances, proved prescient in preparation for the pandemic. Throughout this period, employee engagement and productivity were exceptional, as our Office continued to advance operational excellence and superior teamwork.

The OFR obligated $62.69 million in FY 2020 42 percent for labor and 58 percent for other expenses. A large portion of the nonlabor figure was due to significant OFR expenses, particularly in the Technology Center ($23.4 million), which support the OFR’s unique mandates. Office staff totaled 107 as of Sept. 30, 2020.

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A look at black-owned businesses in the u.s..

The owner of Marcus Book Store, the oldest Black-owned bookstore in the U.S., talks with her employee about a shop display in Oakland, California, in December 2021. (Amy Osborne/The Washington Post via Getty Images)

More than one-in-five Black adults in the United States say owning a business is essential to financial success, according to a September 2023 Pew Research Center survey . While Black-owned businesses have grown significantly in the U.S. in recent years, they still make up a small share of overall firms and revenue, according to our analysis of federal data.

Pew Research Center conducted this analysis to examine the characteristics of Black-owned businesses in the United States. The analysis relies primarily on data from the 2022  Annual Business Survey  (ABS), conducted by the U.S. Census Bureau and the National Science Foundation’s National Center for Science and Engineering Statistics.

The survey – conducted annually since 2017 – includes all non-farm U.S. firms with paid employees and receipts of $1,000 or more in 2021. Firms are defined as businesses “consisting of one or more domestic establishments under its ownership or control.” Majority business ownership is characterized in the survey as having 51% or more of the stock or equity in the firm. The Census Bureau counts multiracial firm owners under all racial categories they identify with; Hispanic firm owners may be of any race. Read more about the ABS methodology .

A bar chart showing that about 3% of U.S. businesses were Black-or African American-owned in 2021.

In 2021, there were 161,031 U.S. firms with majority Black or African American ownership , up from 124,004 in 2017, according to the latest estimates from the Annual Business Survey  (ABS), conducted by the U.S. Census Bureau and the National Science Foundation. Black-owned firms’ gross revenue soared by 43% during this timespan, from an estimated $127.9 billion in 2017 to $183.3 billion in 2021.

Despite this growth, majority Black-owned businesses made up only about 3% of all U.S. firms that were classifiable by the race and ethnicity of their owners in 2021. And they accounted for just 1% of gross revenue from all classifiable companies that year. By comparison, in 2021, roughly 14% of all Americans were Black.

As has  long been the case , White majority-owned businesses made up the greatest share of classifiable firms (85%) and their revenue (93%) in 2021. About one-in-ten classifiable firms (11%) were majority-owned by Asian Americans, and no more than 7% had majority ownership by someone from another racial and ethnic group.

The Annual Business Survey classifies businesses as “majority Black- or African American-owned” if a Black owner has at least 51% equity in the firm. The same standard holds for business owners of other racial and ethnic backgrounds. The U.S. Census Bureau counts multiracial firm owners under all racial categories they identify with; Hispanic firm owners may be of any race. 

Not all U.S. businesses are classifiable by the race or ethnicity of their owners. In 2021, about 4% of all businesses in the U.S. were  not  classifiable by the race and ethnicity of their owners – though these firms accounted for 61% of total revenue. Ownership and revenue figures in this analysis are based on the roughly 5.7 million firms that  were  classifiable by the race and ethnicity of their owners in 2021, most of which are smaller businesses.

How many workers do Black-owned businesses employ?

Black or African American majority-owned firms provided income for roughly 1.4 million workers in 2021. Their annual payrolls were estimated at $53.6 billion.

Still, most Black-owned firms tend to be smaller businesses. Two-thirds had fewer than 10 employees in 2021 ; 13% had 10 to 49 employees and just 3% had 50 or more. Another 16% reported having no employees. (The ABS determines employment size by the number of paid workers during the March 12 pay period.)

What’s the most common sector for Black-owned businesses?

By far, health care and social assistance. About 45,000 of the roughly 161,000 U.S. companies with majority Black or African American ownership, or 28% of the total, were part of this sector in 2021.

Looked at a different way, 7% of  all  classifiable U.S. businesses in the health care and social assistance sector were majority Black-owned that year .

A chart showing that health care and social assistance is the most common sector among Black-or African American-owned businesses.

Other common sectors that year included:

  • Professional, scientific and technical services (comprising 14% of all Black-owned businesses)
  • Administrative and support and waste management and remediation services (8%)
  • Transportation and warehousing (8%)
  • Retail trade (6%)
  • Construction (6%)

Where are Black-owned businesses located?

A map showing that Black- or African American-owned businesses made up greatest share of firms in District of Columbia, Georgia and Maryland in 2021.

Most Black or African American majority-owned businesses (87%) are located in urban areas. Just 5% are in rural areas – that is, places with fewer than 2,500 inhabitants, under  the Census Bureau’s definition .

Some of the most populous states also have the greatest number of Black majority-owned businesses. Florida had 18,502 such businesses in 2021, California had 15,014 and Georgia had 14,394.

Black majority-owned businesses made up the greatest  share  of all classifiable firms in the District of Columbia (15%), Georgia and Maryland (8% each).

Who are Black business owners?

  • They’re more likely to be men than women. Some 53% of Black-owned firms in 2021 had men as their majority owners, while 39% had women majority owners. Another 8% had equal male-female ownership. The gender gap is larger among classifiable U.S. firms overall: 63% were majority-owned by men in 2021, 22% were majority-owned by women and 14% had equal male-female ownership.
  • They tend to be middle-aged. Roughly half (49%) of Black or African American business owners who reported their age group were ages 35 t0 54 in 2021. Another 28% were 55 to 64, and just 7% were younger than 35.
  • A majority have a college degree. Among owners who reported their highest level of education completed, 27% had a bachelor’s degree and 34% had a graduate or professional degree in 2021.

What motivates Black entrepreneurs?

When asked to choose from a list of reasons why they opened their firm, about nine-in-ten Black or African American majority owners who responded said an important reason was the opportunity for greater income; a desire to be their own boss; or wanting the best avenue for their ideas, goods and services. Balancing work and family life (88%) and having flexible hours (85%) were also commonly cited.

For most Black or African American majority owners, their business is their primary source of income . Seven-in-ten of those who reported income information in 2021 said this was the case.

Note: This is an update of a post originally published on Feb. 21, 2023.

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8 facts about Black Americans and the news

Key facts about the nation’s 47.9 million black americans, facts about the u.s. black population, african immigrants in u.s. more religious than other black americans, and more likely to be catholic, across religious groups, a majority of black americans say opposing racism is an essential part of their faith, most popular.

About Pew Research Center Pew Research Center is a nonpartisan fact tank that informs the public about the issues, attitudes and trends shaping the world. It conducts public opinion polling, demographic research, media content analysis and other empirical social science research. Pew Research Center does not take policy positions. It is a subsidiary of The Pew Charitable Trusts .

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