How to present the income statement and compare performance between periods

Learn about the income statement (profit or loss statement), its benefits, how to read it, how to compare performance between different periods, and export it as a PDF or Excel file.

The income statement is a financial statement that shows the results of a company's operations over a specific period, by presenting revenues, costs, and expenses leading to net profit or loss.

ℹ️ Note: The income statement appears in a summary form when only the expenses app is installed. To view it in detail, install the accounting app.

#Benefits of the Income Statement

1. Clarifies revenues, costs, and expenses.

2. Indicates whether your business is making a profit or suffering a loss.

3. Helps you evaluate profitability and compare financial performance with previous periods for accurate decision-making.

ℹ️ Note: The Riwaa accounting system updates the income statement continuously when recording daily entries, whether the entries are automated or manual, so you don't need to do calculations or mathematical equations to prepare the statement.

#Accessing the Income Statement

1. Go to Reports > Financial > Income Statement.

2. Click on the report to view details.

3. Select the time period.

4. Select the location.

5. The data appears directly based on the selected options.

#Filtering the Income Statement by Cost Center

1. Click on "Filter".

2. Select the cost center.

3. Click on "Apply".

4. The results appear based on the selected cost center.

ℹ️ If you haven't added cost centers, a window will appear (No cost centers added). To know how to add a cost center, click here.

#Comparing the Income Statement Between Different Periods

💡 Comparing the income statement is a feature that allows you to display the performance of the income statement for several consecutive periods side by side, instead of only displaying one period. This feature helps you track changes in revenues, expenses, and net income over time more clearly.

Example: If you want to know how your business performance has changed over the last 3 months, you can compare the current month with the previous two months, and the results will appear in a single table for easy review.

#Steps to Compare the Income Statement

1. Click on "Filter".

2. Select the date and location.

3. Click on "Compare with", and choose the period you want to compare with:

   • Previous month.

   • Previous quarter.

   • Previous year.

4. Click on "Number of periods", and specify the number of consecutive periods you want to compare, with a maximum of four periods.

5. Click on "View".

Each period appears in a separate column, allowing you to compare income statement items between the specified periods.

#How to Read the Income Statement

• The statement starts with revenues, followed by direct costs and operating expenses.

• The account name appears on the right side of the statement, and its balance on the left side.

• Sub-accounts are displayed under the main accounts according to their order in the chart of accounts.

• The total balance appears at the bottom of each group of accounts.

• At the end of the statement, you will see:

  • Total profit.

  • Operating profit.

  • Net income.

ℹ️ The row dedicated to the total is in gray.

ℹ️ If the number is in parentheses, it means the balance is negative (debit).

#How to Calculate Profits and Net Income

• Total profit = Total revenues – Total direct costs.

• Operating profit = Total profit – Total operating expenses.

• Net income = Total revenues – (Total costs, expenses, and taxes).

#Exporting the Income Statement

1. Click on "Export".

2. Choose the file format: Excel File or PDF.

3. The file is downloaded to your device.

ℹ️ When comparison is enabled, the file includes all periods displayed in the income statement table.

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#Frequently Asked Questions

1. What types of expenses are included in the income statement?

• Operating expenses, such as salaries, rents, utility bills.

• Depreciation expenses, such as equipment and fixed assets.

• Interest expenses, such as bank fees.

• Direct cost (cost of goods sold), such as raw material and labor costs.

2. What is the benefit of the filter option next to the date?
   It is used to specify the date, location, and cost centers, and set up comparisons between previous months, quarters, or years.

3. Can I print the income statement from the platform?

   You cannot print the income statement directly from the platform, but you can print it after exporting it to an Excel or PDF file.

4. Can I compare different periods, such as a month and a quarter?
   No, the periods must be of the same type; month with month, quarter with quarter, or year with year.

5. Can I view the income statement without enabling the comparison?
   Yes, comparison is optional. If you do not specify a period for comparison, the income statement for one period will appear as usual.