Tracking key financial metrics is essential for any business owner or manager. These metrics can help you understand how your business is performing financially, identify areas where you can improve, and make better decisions about your business's future.

1. 6 KEY FINANCIAL
METRICS TO TRACK
1) REVENUE
Revenue is the total amount of money
that a business makes by selling products,
and services before any expenses are
taken out.
Revenue = Sale price X Units sold
2) EXPENSES
Expenses = Cost of goods sold + salaries +
sales commissions + marketing costs + real
estate expenses + utilities
Expenses are all the costs a business
needs to operate.
3) NET INCOME
Net profit = Revenue – Total expenses
4) CASH FLOW
Operating cash flow = Net income + Non-Cash
expenses – Increase in working capital.
Cash in < Cash Out = Negative cash flow
Cash In > Cash Out = Positive Cash flow
Cash In = Cash Flow = Breakeven
Cash flow refers to the amount of money
moving in and out of your business over a
period of time.
5) ACCOUNTS RECEIVABLE
AGEING
Organise the clients by due date – immediately
is 1-30 days, 31-60 days – late to see how
much money is collectable from different
clients and customers.
AR ageing measures how many days it
takes your customers to clear the invoice?
6) ACCOUNTS PAYABLE
AGEING
AP ageing measures - how many days it
takes for your business to clear the dues?
Net profit or net income is the money left
over after subtracting all the expenses &
taxes for revenue.
Website - www.paci.ai
Contact - advisory@paci.ai