Principles Of Effectively Presenting Your Finances Well To Your Leadership Team

By Andre Gilmore, Senior Consultant, HTG Peer Groups

How do you keep your leaders in the loop about the financials of the business? The importance of the leadership team of any business understanding the current financial state of affairs cannot be understated. As the year progresses and certainty of plans and budgets give way to the reality of actual performance, it is vital that leaders are kept abreast of current conditions on the ground. If you are responsible for preparing and communicating financials to your leadership team, the following principles can help:

• Know your audience: All leaders are not accountants. This simple truth needs to be kept in mind when presenting financials. Do not assume everyone in the room has high financial acumen. By understanding your audience, you can better explain the financial data in terms that are relevant to leadership. Remember, the goal here is not to teach an accounting class, it’s to equip leaders in the business with the financial information they need to make informed decisions and course corrections.
• Focus on the big picture. While detailed results can be helpful in managing day-to-day business operations, the most important thing for decision makers to understand is the big picture. Clearly and concisely laying out how the business is performing relative to plan trumps a detailed readout that potentially obscures its relevance in a myriad of numbers. Take time to summarize information such as a high level P&L or cash flow statements. In most instances, avoid the detailed drill down unless you are providing a response to a specific question.  
• Provide analysis and observations. When presenting financials, it is important to understand the difference between data and information. Information is useful; raw data is not. Your detailed understanding of monthly financials gives you unique insight into variances and anomalies. You are in a unique position to highlight these to the team. Be prepared to help explain the “why” of the numbers. If you are able to articulate the detail that is absent in summarized reports, while providing insights gleaned while preparing the financials, you provide a valuable function to your organization.

These principles are essential to presenting user-friendly financial information that will keep your leadership team equipped and informed.  In HTG we discuss topics like organizational leadership.  To learn more visit HTG Peer Groups.com.

Andre Gilmore is a Senior Consultant with HTG Peer Groups.  Prior to joining the HTG Peer Groups staff, he spent almost 20 years in various roles in small business ownership, operations management and business process improvement. He is passionate about analyzing company financial data to plan for the future and helping companies improve their level of execution by implementing sound business processes. You can reach him at agilmore@htgpeergroups.com or find him on LinkedIn.

This article originally appeared at http://htgpeergroups.com/blog/entry/principles-of-effectively-presenting-your-finances-well-to-your-leadership-team.html.