Profit & loss

Available on the Business and Team plans (it needs expense tracking to have a cost side).

Revenue is vanity; profit is sanity. Analytics → Profit puts income and spending on the same chart, over the same twelve months.

The KPI cards

  • Income (12 mo) — cash collected over the last twelve months, with this month's figure below
  • Expenses (12 mo) — what you spent, with this month below
  • Net (12 mo) — income minus expenses, green or red, with your year-to-date net
  • Margin (12 mo) — net as a percentage of income

Margin is the one to watch over time. Income and net both move with the size of the business, so a good year and a bad year can look similar in shape; margin does not, and a margin sliding by two points a year is the kind of thing that is invisible month to month and decisive over three years.

The chart

Twelve months of income bars and expense bars, with a net-profit line running across them. The patterns are what you come for: seasonal dips, an expense line creeping up faster than income, or the month a big job finally paid and dragged everything back into the black.

Twelve months is deliberately enough to see a season. Comparing one month to the one before it is mostly noise in a business that does project work.

How the numbers are built

As the report itself notes: "Cash basis: income is payments received; expenses are dated when incurred. Billable expenses appear here as costs and again as income when the reimbursing invoice is paid."

In practice:

  • Income follows the cash-basis rule — payment dates, with cancelled invoices excluded
  • Expenses count on their expense date, which is when the cost was incurred rather than when you got round to entering it
  • A billable expense shows as a cost when you incur it, and the reimbursement shows as income when the client's invoice is paid, so both sides of the pass-through are visible

That last point catches people out. Materials you buy in March and rebill in May make March look worse and May look better than the job really was. The margin over a full year is right; a single month containing one side of a large pass-through is not the number to make decisions on.

Why income here may not match your revenue report

Both are cash-basis and both count payments on the date they cleared, so they should agree. If they do not, the usual cause is a date range that is not actually the same — this report is a rolling twelve months, not a calendar year to date.

Making this report trustworthy

It is only ever as good as your bookkeeping habits:

  1. Record every expense, the small ones included — fuel and software subscriptions add up to a margin point faster than anyone expects
  2. Use recurring bills so fixed costs are never simply forgotten
  3. Record payments promptly, so income lands in the month it actually arrived
  4. Keep categories consistent, so the expense side can be read as well as totalled

An incomplete expense side does not make this report slightly optimistic. It makes it wrong in the one direction that matters.