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What are the Key Accounting Reports for a Small Business? Monitoring business performance means taking time to analyze financial components through a series of accounting reports. This analysis supports accurate budget and forecast creation. There are a few fundamental reports that every small business owner should understand and generate regularly. Building accounting reports on a monthly, quarterly and annual basis makes it easier to identify operational concerns, successes and trends. Income Statement The income statement illustrates the revenue that your company generated and where that revenue came from. It also details where the company spent money. The report is often referred to as a P&L, which stands for profit and loss. Every income statement reflects a defined period, whether it is the past month, past quarter or fiscal year. The first section details the company’s revenue listed by source. That includes sales, service and advertising figures. The section ends with a total revenue calculation that sums all sources. Expenses follow the revenue section. This illustrates all of the company’s expenses, detailed by source. The cost of goods sold, salaries, overhead expenses and operating costs appear here with a total expense sum at the bottom. The difference between the revenue and expenses appears at the bottom as the net income or loss for the reporting period.