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Rolling 12 – Advantages and disadvantages of rolling reporting

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Access to economic data is greater than ever, but surprisingly many do not maximize the benefits of it. With the reporting method Rolling 12, you get clearer insight, heavier decision support and better forecasts, all year round.

The Board of Directors and management jointly set clear goals for the company. Where do you want to be in 1, 5 and 10 years? How much return can you expect? When is a good time to bet and when are you going to hold back?

To ensure that the company’s development goes according to the established plan, the development needs to be reviewed regularly. This is done, among other things, by calculating and reporting various key figures, which are compared over time.

Not sure which key figures are of interest to follow your company’s development? Here you can read more about
how to choose the right key figures
.

Good reporting is a prerequisite for successful companies

With good reporting , you have a better chance of achieving success with the company. That’s because regular analysis and reporting gives you a better handle on how your business is doing. It allows you to pick up warning signs and other signs that require action. The problems that the future holds can be dealt with before they have time to turn into reality, and the company can continue on the right trajectory.

KPI analysis in minutes – which everyone understands

This is Rolling 12

The method is a useful tool for businesses that want to be proactive in the face of signs of unwanted change and who want to be able to follow their progress at more frequent intervals.

With Rolling 12, you produce trend reports where you show sales, profitability or other key figures as an annual result up to the last month.

With Rolling 12, you can thus produce a new annual report – every month, instead of just showing last month’s turnover and once a year showing the result for the whole year.

Advantages of Rolling 12

More and more people are discovering the benefits of Rolling 12 reporting. Here we list the main advantages.

Clearer

Rolling 12 reporting emerged as an alternative to traditional reporting, as the key figures individually do not really tell us what the growth in the company looks like. Since what appears in Rolling 12 reporting is 12 months rolling value, the jumps between periods are hidden. With Rolling 12 reporting, the trends are therefore visualized in a clearer way, and it becomes easier for the board and management to find out where the company is heading.

Previous signs of change

By using Rolling 12 reporting, you can pick up warning signals and make changes to the business at an earlier stage. Thanks to receiving a type of trend report, you can make active decisions that matter for the company’s future, both in the short and long term.

Better forecasts

Of course, it is not only warning signs and negative trends that are detected. Sometimes Rolling 12 reporting can show a fairly neutral development. Regardless, it will be easier for you to make more accurate forecasts for the future.

Faster decisions

When you create a more frequent and active picture of the company’s development, you can make important decisions at short notice, unlike if you would have analyzed the numbers once a year.

Always ready for due diligence

With rolling reporting , you are always ready to put current key figures in a holistic perspective, for example to present to potential investors or buyers. We’ve talked a lot about
the importance of being ready for due diligence
earlier – Rolling 12 can help you with the preparation.

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Cons of Rolling 12

The disadvantages of Rolling 12 reporting are fewer than the advantages, but sure enough, they always exist.

More time consuming

The obvious disadvantage of Rolling 12 reporting is, of course, that it is more time-consuming than traditional annual reporting. Producing key figures twelve times a year, instead of one, simply takes more time, although there are of course digital services that facilitate and automate the whole thing. Then add that you should also spend the time analyzing what the key figures tell you, and determine what measures are required to avoid any problems that the analysis shows signs of, and even more time has passed.

Inefficient for some operations

In order to take advantage of the benefits of Rolling 12 reporting, there needs to be something new to analyze every month. If you run a smaller company, not every payment or sale says as much for the whole.

How rolling forecasting works for groups

In a group , the financial years between the subsidiaries can often differ. It can cause problems in the comparison if the key ratio analysis is carried out at the end of each financial year. If you instead choose to work with Rolling 12 reporting, you can easily compare the Group’s different companies with each other, as all figures are equally current each period.

Take your analysis to the next level

Many boards and management teams attach great importance to selecting and producing a basis for important key figures in the company. That is all very well. With rolling reporting , you can take analytics to the next level, and elevate the business at the same time.

As with most things in life, it’s rare Rolling 12 reporting works painlessly all at once. Expect a transition period where you and your team regularly need to review and evaluate the method and how it is used in the company. With that in mind, you and your company have a good starting point if you would like to try rolling 12 reporting.

Smart budgeting tools for budget and forecast

Today, there are many intelligent digital solutions to easily manage budget and forecast and rolling forecast. The solutions usually support both traditional budget, forecasts for any time period and rolling forecasts. With our budgeting tool , you automate manual processes and get numbers you can trust.

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porträtt på Pär Haga, Vd på Boardeaser

Pär Haga

CEO

+46 73 725 19 83
par@boardeaser.com

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