If you’re running a small business, then your profit and loss report is a vital part of your administration that allows you to plan and make informed decisions. While some people might take to budget planning like a duck to water, others don’t, but the good news is that a budgeting course online can help you get the knowledge you need.
We’ll cover how you can train easily and at your own pace shortly, but first, we’ll be taking a closer look at profit and loss reports, why they’re important and what they contain. So, without further delay, let’s dive in and get started.
What Exactly Is a Profit & Loss (P&L) Report?
Essentially, a P&L report is a statement that summarizes details of your expenses and revenue. Used to put together an overall budget planner strategy, it will contain a myriad of information to include incomings, outgoings, accounts payable and selection of other data that illustrates a business’s ability to generate sales and remain solvent.
At its heart, your profit and loss report (sometimes referred to as a statement) is quite simple in that it’s based on a basic formula i.e. Revenue minus Expenses equals Profit. Generated on a periodic basis that can be on an annual, quarterly, monthly or even a weekly basis, it offers a great deal of insight into the overall financial health of a business.
What’s Included In a P&L Report?
Look on your average P&L budget template and you’ll typically find the same components being included. Precisely detailing all business income and expenditure, the document can be used to guide important decisions relating to purchases and expansion.
The components you’ll encounter include:
- Revenue - net sales from primary business activity over the reporting period
- Cost of Goods Sold - representing the cost of services and products sold
- Gross Profit - a.k.a. Gross margin, this is your revenue, excluding sales costs
- Operating Expenses - administrative costs relating to the cost of running your business
- Operating Income - this is your business earnings before taxing, interest and depreciation
- Net Profit - detailing your profit in its purest form, after all, your deductions
As you’ll learn when taking a budgeting course online, your P&L sheet is the go-to documentation for fundamental information relating to your business profitability. Without an up-to-date report in your possession, the task of making wise decisions becomes that much harder.
Boost Your Budgeting Knowledge With Online Course Training
No one is saying that budgeting and financial planning is easy, but the great news is that there is plenty of help out there to boost your knowledge. For instance, our Prepare & Monitor Budgets course is a budget course online that’s not only CPD-approved but also created in conjunction with industry experts and can be paid for in manageable instalments.
What’s more, all the training we offer at OCA is video-based, making the whole experience much less taxing. It’s modular too, meaning that you can progress through it at a pace that suits your needs. So, if you’d like to find out more about us and the training we provide, simply visit us today at www.onlinecoursesaustralia.edu.au.
Alternatively, to speak to us directly about your needs prior to enrolment, just give our friendly team a call on 1300 611 404 and we’ll be more than happy to talk you through your options.