The difference between management reports and financial reports

Financial and management reports are the fundamental to the success and going concern of a business. For large businesses, various departments have to contribute for these reports to give a true picture of the organizational operations. 

However, for small businesses one person might be able to handle the reporting of an organization. While some may think reporting is just about calculating numbers, management reports and financial reports contain a number of differences in content and the generation process. Before hiring a specialist, it is important to understand the differences in the two types of reporting.

Financial reporting refers to the process of providing financial information to company stakeholders in order to influence business goals. The process includes three important components which are the cash flow, the profitability and the value of assets (current and non-current). The finance person tasked with preparing these reports must have an understanding of the variety of statements and the accounting standards required.

The several different types of financial management and reporting are Statement of profit or loss and comprehensive income, Statement of financial position, Accounts that are to be paid (Creditors), Accounts from where funds are coming and Statement of transactions (Debtors). Financial reporting has to be done accurately by a sharp and diligent professional.

On the contrary, management reporting is key to assess a company’s operation and performance. Management accountants send monthly management reports to the CEO.

These inform stakeholders who in turn can better make decisions about the company’s profit points, performance, and tactical steps to benefit the company as a whole. The monthly reports that are sent to the management outline the company’s overall performance in the fiscal year. It is important that management reporting is done by a critical thinker to produce the best results.

Financial reporting includes external reports that require certain standards and guidelines to be followed. They demonstrate the company’s overall performance. Moreover, they facilitate easier comparison between successive financial years.

In contrast, management reporting includes internal reports, including information regarding banks, investors and CEOs. Flexible guidelines. Management reports demonstrate the company’s reports for segments. The way they help business forecasts the company’s future cannot go unmentioned.

In conclusion, it is important to note that management and financial reports are different. However, both are concerned with making a business viable. In order for a business to remain competitive sound financial and management reports are top priority.


Digital Marketing 101. Core things to know and why it matters in Zimbabwe

One thing about Marketing is that it is the most evolving field. This means if you aren’t into trends or can’t look around and monitor what’s happening around you, you will be left behind.

If we were in 1919, 100 years ago, a simple Newspaper advert would have been enough to keep your salespeople busy.

50 Years ago, in 1969, a simple television ad would help your business expand, helping you hire a dozen employees and get ahead of your industry.

10 years ago, in 2009, getting a website and spamming it with keywords related to what you are selling would have been more than enough to get you ahead and help you win.

There is one fact that still astounds me to date and it is the fact that marketing has changed more over the last 10 years than it did in the last 100 years combined.

Consider Africa, Zimbabwe to be specific. The internet research organization, places Zimbabwe’s Internet penetration rate as of December 2018 at 39.3 %. This means out of the total 17 million Zimbabwean’s existent today, about 7 million have access to the internet.

Source: StatCounter Global Stats – Social Media Market Share

What’s awesome is not the fact that the above people have access to the internet, it’s the fact that ZBC does not hit those kinds of numbers, prove me wrong!

If we are going to drill down on the above, there are some interesting stats that you will learn.

Hackernoon, one of the best Research organizations and sites says the average person spends 6 hours a day staring at their smartphone. This amounts to an average of 180 hours a month. What this effectively means is that the average person now spends most of his/her free time staring at their smartphone.

You are probably wondering what they will be doing? Well, Social Media, Mobile Gaming, Reading the Bible, YouTube Etc.

Now, this gets more interesting because if we drill down the numbers we’ll learn that a third of the time spend online by Zimbabweans and Africans, in General, is spent on Social Media and browsing Social Media Sites.

Internet Usage Times

Why are these numbers necessary?

I wanted you to get an appreciation of how much people are addicted to Digital Media, Social Media, and the internet in general.

The power of this is, you can show these people ads anytime whenever you want.

You can show them your ads as they browse the internet.

You can show them your ads as they watch videos on Youtube.

You can show them your ads as they play Games on their Phone.

You can show them your ads as they read the news online on websites like the One for the Herald and Newsday

You can show them your ads as they browse through their timeline on Facebook.

You can show them your ads as they Prepare to respond to a Facebook Message.

You can show them your ads on the lock screen of their phone.

You can show them your ads when they search on Google.

In short, you can show them your ads, anywhere, at any time as long as they are holding a mobile phone.

So what is Digital Marketing then? It’s the art of showcasing your products and services to people whilst they are relaxed and in the middle of doing what they love the most.

There is much to say when it comes to Digital Marketing and I’m going to make this a 3 month-long weekly series where we are going to cover the complete A-Z of Digital Marketing.

If you want to stay updated and not miss out, just be sure to subscribe to our Growthpoint Newsletter to receive our updates.