FAQ: What Financial Reports Should I Review Monthly?
- Miranda Kishel
- Aug 15
- 2 min read
The most important financial reports you should review every month are your Profit and Loss Statement (P&L), Balance Sheet, and Cash Flow Statement. Together, these reports provide a complete picture of your business’s revenue, expenses, assets, liabilities, and cash position. In addition, reviewing Accounts Receivable Aging, Accounts Payable Aging, and Bank Reconciliation Reports helps you keep track of money owed to you, money you owe, and the accuracy of your bookkeeping outputs.
Why Monthly Review of Financial Reports Matters
Many business owners only glance at their bank account to judge performance. But without structured monthly reports, you miss red flags like mounting receivables, creeping expenses, or seasonal dips in cash. Consistently reviewing your bookkeeping outputs lets you spot trends, make better decisions, and avoid costly surprises. According to the SBA, keeping accurate, timely records is a cornerstone of good financial management for small businesses (source: SBA.gov).
The Core Monthly Reports to Review
Profit & Loss Statement (P&L)Shows revenues, expenses, and net income for the month. Essential for tracking profitability and performance against goals.
Balance Sheet A snapshot of assets, liabilities, and equity. Helps you monitor debt levels, working capital, and overall financial health.
Cash Flow Statement Breaks down operating, investing, and financing cash movements. Useful for understanding how cash is actually flowing in and out of your business.
Accounts Receivable Aging Report Identifies outstanding invoices and overdue customer payments.
Accounts Payable Aging Report Tracks what you owe vendors and ensures timely payments.
Bank Reconciliation Report Confirms your accounting records match bank records, helping prevent errors or fraud.
Related Questions Clients Often Ask
How do I know if my bookkeeping outputs are accurate?
Which reports should I review weekly vs. monthly?
How do I turn financial reports into actionable insights?
Can I automate monthly reporting so I don’t fall behind?
What should I review with my accountant vs. on my own?
Actionable Tips for Reviewing Monthly Reports
Set a Monthly Review Date Block time on your calendar—ideally the same week each month—to review all reports.
Compare to Budget & Prior Months Look at trends: Is revenue growing? Are expenses consistent? Did cash reserves increase or shrink?
Flag Red Items Pay close attention to overdue receivables, unexpected expense categories, or negative cash flow.
Use Visual Dashboards Charts and graphs make patterns easier to see than raw numbers.
Delegate Prep Work Have your bookkeeper or accounting system generate the reports automatically so your time is spent on review and decision-making, not pulling numbers.
Document Insights Keep a simple monthly “financial notes” file where you track what stood out and what actions you’ll take.
Next Step
If you don’t yet have a reliable monthly reporting process in place, we recommend starting with consistent bookkeeping outputs. A clean, reconciled set of books makes all the difference. Learn more about how Development Theory supports small businesses with bookkeeping and payroll here: Bookkeeping & Payroll Services.
