4 Reports the Board Will Love

Financial reports are an important way to efficiently communicate information to board members. This allows them to then make more informed decisions about the future activities of the business and what expansion projects may be in the pipeline.

However, for many boards, financial information is delivered in a way that doesn't automatically make sense to them and is hard to put into context. In addition, the most important reports are normally only delivered annually so it's difficult to understand the relevance of more regular reports.

Below are four reports that will help you communicate more effectively with board members, and allow them to contextually understand your findings:

1. Basic financial information

A basic financial report should contain the income statement showing any revenue and expenses for the period compared to the available budget, a balance sheet reflecting the assets and liabilities of the company, and the proposed budget for the period ahead based on data-driven insights. Stick to these three core components to ensure a streamlined report process, which allows you to deliver more frequently and give board members a more up-to-date snapshot of where the company is at.

Aim to deliver basic financial reports at least each quarter to board members, though monthly reports can be advantageous, allowing the board full visibility on the financial status and what seasonal changes affect the company's finances.

2. Figures in the context of business objectives

Having a separate report where you put the fiscal findings in the context of business objectives allows your basic financial report to be much more streamlined, while also giving you the time to properly contextualize the figures for the board.

These will often be the most useful reports for board members and offer complete transparency on how close the organization is to achieving its business objectives. Finance teams should work alongside C-level executives, directors and board members to see whether these findings mean that the objectives need to be adjusted, or the company's approach to reaching them.

3. Year-on-year comparisons

Some members of the board will only want to know whether the organization is performing better or worse than in the period before. This makes year-on-year reports crucial. Identify the most important figures for the board and position these alongside those from the same period the previous year.

One of the benefits of doing year-on-year comparisons in a separate report is that it leaves you plenty of space to deliver this information in graphs or bar charts, allowing board members to quickly see the position of the company.

4. Progress towards end-goals

Focusing on the KPIs and metrics used to measure progress towards the business's goals, this report should make it clear how close the organization has come to achieving its overall targets, and how much further it needs to go.

This report should also show whether continuing on the same approach will allow the business to reach its goal or if an alternative method may be more successful in the long term.

Reporting to the board

Streamlining your basic financial report allows board members to get all the figures they need to make informed decisions, while the other reports ensure they get all the context they need to properly understand where the company sits.

It's important that board members get the appropriate training on how to interpret financial reports as this can save both the finance team and the board a lot of time. However, even once this is completed, you still need to ensure your reports are as accessible as possible to people outside of finance. This means removing as much jargon as is feasible from your recommendations and findings to ensure members of the board get as much from your financial reports as they can.