Creating Visual Financial Reports

Standard financial reports tend to follow the same template, which is a list of accounts and their totals for the month and year. This information is critical to financial advisors, but the standard report template doesn’t tell us what the values mean. One of the goals of any report is to highlight relevant information so a user can easily see if something’s wrong and take corrective action. Let’s examine two kinds of financial reports and you can decide for yourself which one would make an impact for more stakeholders at your organization.

The report below shows a sample income statement for a fictional company. While it displays all of the necessary information, you’d have to read every line item in order to find out that the total income from this month is down 50% from the same time last year. It’s also difficult to differentiate the total from specific line items because the dollar amounts are the same font size and color. With the technology available to finance teams today, this type of boring, ineffective financial report should become a thing of the past.example-boring-income-statement-smBy contrast, see the arcplan financial report below; you can click to enlarge it. It’s designed to show very similar data as the previous income statement, but it’s much easier to identify relevant information. The arrow on the right points to the variance column, which is automatically calculated. When the variance font is colored green, as it is on the Revenue line item, it indicates a positive (good) variance. Expenses that have a positive (bad) variance are colored red. This is common sense to a financial admin – as higher costs are undesirable – but something that’s rarely shown on reports. Additionally, the variance is displayed as a bar chart so a user can quickly glance at the report and identify large variances.income-statement-arcplan-smThe arrow on the left side of the report highlights arcplan’s ability to embed charts within tables (we call them micro charts). In this example, the micro charts display the variances over the last 12 months. To create a better user experience, the absolute value of that variance was used to create the charts and they are simply colored red or green to show positive and negative values. The point of these charts is not to provide the user with 12 new data points. Instead it’s to give them a visual cue that draws attention to accounts that have high variances. Again, a user could look quickly at this report and easily determine that despite the drastic increase in revenue, there was also a large increase in expenses and that explains why the net income is only slightly higher than last year.

One of the biggest benefits of building visual reports like the example above is that they can be used by non-finance employees. A manager in the IT department could be handed a department-specific visual report and quickly understand how costs have increased over the last year. The more people who can use and understand your reports, the more valuable those reports become.


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