Why Business Owners Avoid Reports (and the Costly Truth)
See What You’ve Been Overlooking
If you’re not checking your reports regularly—you’re not alone.
Many business owners avoid reports, not because they don’t care about their finances, but because the reports feel intimidating, confusing, or simply disconnected from day-to-day business decisions. If that sounds like you, you’re in the right place—and you’re not doing anything wrong. But you may be missing out on valuable insight that could actually make running your business easier.
Let’s unpack why so many business owners avoid reports—and more importantly, what they’re missing when they do.
Why Business Owners Avoid Reports
Most small business owners are juggling sales, clients, fulfillment, marketing, and putting out fires. The idea of sitting down to look at financial reports can feel like just another task—one that doesn’t bring an obvious return.
Here are a few common thoughts I hear from clients:
- “I wouldn’t even know where to start.”
- “I look at my bank account instead—it’s faster.”
- “It feels like it’s written in another language.”
- “My accountant looks at those at tax time. Isn’t that enough?”
These are valid reasons. Most business owners weren’t taught how to read reports. And if you don’t know what to look for, it’s easy to feel like reviewing them is a waste of time.
That’s exactly why business owners avoid reports—they don’t realize how much clarity those reports can bring when they’re used as decision-making tools rather than accounting checkboxes.
But Here’s the Cost of Avoiding Reports
When business owners avoid reports, they often miss early warning signs, untapped opportunities, and insights that could prevent costly mistakes. You don’t need to be an accountant to benefit from your financials—you just need to understand what they’re trying to show you.
Before we dive into what you might be missing by skipping your reports, let’s quickly cover where to find them in QuickBooks Online. Knowing where to look is the first step to making sense of your numbers.
Where to Find Reports in QuickBooks Online
To start using the reports mentioned in this article (like the Profit & Loss, Balance Sheet, and Cash Flow Statement), follow these steps in QuickBooks Online:
- From the left-hand menu, click on “Reports.”
- Use the “Standard” tab to access the most common financial reports.
- Scroll or search to find:
- Profit and Loss
- Balance Sheet
- Statement of Cash Flows
- Use the date range dropdown to adjust the timeframe (e.g., “Last month,” “This quarter,” etc.).
- Click “Customize” (top right) to filter or adjust columns if needed.
💡 Tip: You can click the ⭐ star next to your favorite reports to save them to the top under “Favorites” for quicker access next time.
Selecting the Appropriate Accounting Method
When running financial reports, it’s crucial to ensure that you’ve selected the correct accounting method—either Cash or Accrual—in QuickBooks Online. Always double-check this setting to ensure your reports align with the accounting method used by your company, providing the most accurate picture of your business’s financial health.
QuickBooks Online reports also display the accounting method selected at the bottom of the report, so you can always make sure by checking there as well.
What You’re Missing When You Skip Your Reports
Now that we know where to find reports in QuickBooks Online and how to select the correct accounting method, let’s continue with the real costs of avoiding financial reports.
Here’s what your financial reports could be telling you—if you’re willing to take a closer look.
1. Why You’re Profitable on Paper, but Cash Feels Tight
This is one of the most common frustrations: “My business shows a profit, but I never have money in the bank.”
The answer often lies in your Cash Flow Statement. While the Profit & Loss (P&L) report shows your income and expenses, it doesn’t account for loan payments, delayed customer payments, or large purchases that hit your bank account but don’t show up as expenses. The Cash Flow report fills in those gaps.
2. Where Your Money Is Actually Going
Business owners avoid reports like the P&L because it feels too detailed—but that’s where the gold is. The P&L can show rising software costs, a spike in marketing spends, or other operational expenses that quietly eat into your margins.
For example:
One client thought their income had dipped—but the real issue was a jump in software subscriptions and marketing costs. The income was steady, but the expenses were growing quietly in the background.
3. Which Offers Are Truly Profitable
When business owners avoid reports, they’re often flying blind when it comes to product or service-level profitability. Using features like Class Tracking or the Projects tool in QuickBooks, you can break down revenue and expenses by service type, product line, or client.
This helps answer questions like:
- Which products/services have the highest margin?
- Are fixed-price projects actually worth it?
- Are we spending too much time on low-profit work?
4. If Your “Slow Season” Is Real—or Just a Feeling
Your gut may tell you that April is always slow, but your monthly revenue reports can confirm it. If the numbers back it up, you can plan around it—whether that means running promotions, shifting launches, or adjusting your budget to account for leaner months.
One client realized that their Q1 was slow every year—and instead of stressing about cash flow, they now plan ahead with reserves and schedule lighter workloads.
5. Whether It’s Time to Raise Prices or Cut Costs
Your reports can also help you decide when to adjust pricing, streamline expenses, or even hire support. These decisions don’t have to be guesses. They should be based on patterns.
- Are your margins shrinking?
- Are expenses creeping up faster than revenue?
- Has your net income dropped consistently over the past 3–6 months?
Reports help you answer these questions before they become problems.
The Mindset Shift: Your Reports Are Not the Enemy
Let’s reframe things.
Business owners avoid reports because they feel like a burden. But what if they were tools, not tasks?
You don’t need to understand every line item. You don’t need to memorize formulas. You just need to get into the habit of asking simple questions:
- What changed from last month?
- Where is most of my money going?
- Does this match what I expected—or not?
Think of it like looking at your car dashboard. You don’t need to be a mechanic to notice when something’s off—you just need to know where to glance.
So Where Do You Start?
Start small. You don’t have to dive into 10 reports or spend hours with spreadsheets.
Here’s what I recommend:
1. Review your P&L once a month
Your Profit & Loss (P&L) statement gives you a high-level view of how your business is performing, but it’s only useful if you look at the right parts.
Each month, take 5–10 minutes to review:
- Revenue: Is it up or down compared to last month or the same month last year?
- COGS or Direct Costs: Are you tracking these at all? If not, you may be overstating profit. These include materials, subcontractors, or labor directly tied to the service/product.
→ Tracking COGS is essential to understanding your gross profit—and many small business owners overlook it entirely. - Gross Profit: Revenue minus COGS. Is this margin consistent, improving, or slipping?
- Operating Expenses: Are there any unusual spikes (software, marketing, payroll)?
- Net Income: Did you make money this month, and how does that compare to recent trends?
This one report—if reviewed regularly—can uncover waste, pricing issues, or cash drains long before they become major problems.
2. Skim your Balance Sheet
- Look at cash, debt, and retained earnings.
- Ask: Am I building financial strength or just treading water?
3. Ask for help when you need it
- Your bookkeeper can help translate reports into plain English.
- Don’t be afraid to ask what something means?
Next Up in This Series: The Only 3 Reports You Really Need
This is the first article in a five-part series designed to help you move from overwhelmed to confident when it comes to your business finances.
In the next article, I’ll walk you through the three financial reports that actually matter—and how they help you make smarter decisions with less effort.
You don’t need to look at everything. You just need to look at the right things.
Ready to See What Your Reports Are Saying?
If you’ve been avoiding your financials because they’re confusing or overwhelming, I can help.
I offer a free bookkeeping review where we’ll look at your reports together and translate them into real insights—without the accounting jargon. No pressure, no sales pitch—just clarity.
References
Intuit QuickBooks – How to Use QuickBooks’ Reports Center [Video]
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