Why is a financial template useful?

Why is a financial template useful?

By Kishana Citadelle
Published: 12/7/21

There is somewhat of a saying that you cannot escape taxes no matter what you do! If you know, you know. A financial report is important for tax season. It helps companies keep track of their revenues and expenses so that they do not to fall in the trap of the IRS or get that visit from the auditors.

We are here to help you flourish in the process that can sometimes seem so overwhelming. You’ll get the definition, the methods to use and a lovely financial report template to fill in and all of that for free.

Now, happy read!

What is a financial report template?

There are two keywords to keep in mind here, and that is a report and a template. We’ll explain below why.

What is a Financial report?

It is an accounting standard where companies disclose their financial situation and performance through a financial report over the course of an accounting year. That period can be done either monthly, annually or quarterly.

It is quite important for managers to understand how to use their money is used ad the movement of the company’s finances from what comes in and goes out are recorded in the report. It directly shows the assets and liabilities that they incur. If this step is neglected, a company might fall into money issues and get financially trapped. And clearly everyone’s main goal is to avoid such horror.

Furthermore, a financial report is the common language between a business owner, investor and the widely known auditors. It is an efficient and legal representation of the company’s health, as it usually is achieved under the Generally Accepted Accounting Principles, which helps see that companies are not evading taxes.

What is a template?

It is a thin plate board or sample document, which one uses as an example to guide them in the style of a document or image, etc. The template is modifiable and can be filled and generally made to fit anyone’s need and purpose. Simply, take a look, click on the details in the template​​ to erase them and start to enter your information. You can find the link here:

How do you write a financial report?

To create a financial report, you must keep certain elements in mind.

1. The type of audience

There should be a goal considered when one decides to start reporting. The reports should be understandable enough that when one, i.e., stakeholders/ shareholders read the report, they automatically see the financial value, health of the company.

It can also be a guide producing such document. As an owner of an organization, you will know which information to divulge, such as numbers, charts, etc.

2. Metrics

This involves the key representatives of your company’s financial data and status.

The financial status can be represented on a:

  • Balance sheet: it is realized at the end of an accounting period, either annually, quarterly or yearly to indicate the business’ liabilities and assets, as well as shareholder equity. Assets are valuable things that the company owns, that can be transformed and generate future benefits, which eventually influences the company’s value.
  • Income statement: Representing the company’s profitability, it corresponds to the revenue of the company over a given period.
  • Cash flow statement: It is the cash movement of the company at a certain time observed to investigate the company’s gains and losses. It is a great tool that helps budget and see what methods need to change in the future to either increase income and reduce expense. Expenses should be lower than your income.

3. Tools

You can use a financial report template that is readily available for that purpose. Appvizer has designed a template that would work and be useful. It is universal, free and easy to modify.

How do I create a financial report?

For something to be effective, it demands a coherent preparation, process, which leads to success. Rome was not built in a day, after all. So, here is how to start:

1. Gather your historical financial results

For this step, like it is said, you need to gather all of your historical financial data, then start creating a sheet to integrate at least of your past financial statements and integrate them into Excel or whatever software you feel best suits your needs and is more beneficial for you. Then, you start calculating things like gross margins, variable and fixed costs, revenue growth, etc.

2. Begin the financial statement

As it shows the money flow of your company, it should only be partly based on your sales forecasts, balance sheet items, etc.

You’ll focus on the income statement, which details the total amount of sales that were accomplished during the accounting period. And as you go along, you make a deduction for each some costs and other expenses associated with your revenue earnings.

Then in the end, after all the expenses deductions, you will know how much the company gained or lost during the accounting period. It is referred to as the bottom line. While, at the top of the income statement, it is the total of money gained.

3. Ensue with the balance sheet

This document is to provide the company with their assets, liabilities and shareholder’s equity at the end of an accounting period.

The assets are what a company owns that is valuable. These assets are either sold or used for products or services to be sold afterwards. They are usually plants, inventory, equipment, etc.

The liabilities are the money that the company owes. It could be loans to pay back, rent, money to suppliers, etc.

The shareholder’s equity is the capital or net worth of the company. It is the money that company would have left once all the assets have been sold and liabilities paid.

Its formula is:

Assets = Liabilities + Shareholder’s equity

What should a financial report include?

A financial statement is a way to record all the company’s annual financial transactions that are prepared under the Generally Accepted Accounting Principles. It respects this standard because for a proper, comprehensible read of the statement by outsiders.

And this is what you’d include for an investor to read:


An item which provides value, profit for a company in the long term.

Comprehensive income

It is the changes incurred by the net assets, net equity of a company over a definite period.

Distribution to owners

It is assets decreasing due to assets transferred and liabilities being acquired to owners.


It is shares issued by a company to shareholders if faced with liquidation, debts or other liabilities.


It represents a company’s use of assets and liabilities at a certain time from deliveries and goods production.


Gains are the company’s increase in equity (net assets) from any transaction less of revenues or investments by owners

Investments by owners

It’s the increase in net assets that is switched from entities of value to gain an increase in ownership interest or equity.


What the company usually owes, in the form of money such as loans, accounts payable, mortgages, ​​bonds, warranties, etc.


It is the company’s loss in equity from transactions.


It is the increase of a business’ assets, liabilities’ settlements over a given period.

So, now that you know that a financial statement tracks the company’s expenses and revenues as well as the assets and liabilities, that you’ll stay on the safe side and run a successful business. Appvizer believes you’ll ace it when the time comes. Don’t forget to come back and tell us what you think.

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