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What does this feature do?

The Financials page contains your 3 financial statements which visualize the data output by your financial model in a standardized accounting format. This includes your income statement, your balance sheet, and your statement of cash flows.

Why should I care?

The Financials tab is often what your investors care about. Furthermore, each financial statement serves a very important purpose in your business. The income statement shows how efficiently you use funds at each stage by describing Revenue at the top and showing the impact of your expenses as they detract from Revenue until finally reaching the bottom of this financial statement as an operating loss or profit. The balance sheet accounts for every dollar spent in your business by balancing assets and liabilities to fully describe how funds enter your business and are used in equal proportion. Finally, the statement of cash flows acts as a “bank ledger” and describes in full detail where cash is spent throughout a given month in the business.

Where can I find it?

Financials is its own page within the platform that can be traveled to from any page view by navigating to the Forecastr logo in the top-left corner and clicking the word “Financials” immediately to the right of the logo.

How should I use it?

Use the income statement (and the margins within it) to compare your business to industry standards and determine whether your operations and expenses are what could reasonably expect for a similar business. This will keep you from having over-indulgent forecasts when standing in front of your investors. Use the balance sheet to monitor your outstanding debts and value-adding assets (being sure to keep balance between your liabilities and equity as well as assets for proper accounting). Finally, use your statement of cash flows to find your fundraising target by locating the largest negative figure in your ending cash balance- doing this will identify the point just before your cash balance would have started to go positive thus making a fundraising target for keeping your business above water until that time has been reached where you can generate positive cash flow.

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