Using the Profit and Loss Report

You can run a Profit and Loss report (also known as an income statement) for your current financial period by clicking Profit and Loss in the Easy Books sidebar. You can:

  • Change the start and end dates of the report.
  • Add another financial period to the report as a comparison.
  • Consolidate the period.
  • Undo a previous consolidation.
  • Save, print or email the report.

Note: If you see the line Opening Balances at the end of your report, this indicates an error in your opening balances (see below).

What does the report show?

The purpose of the report is to show the total revenue, total expenses (outgoings) and how much profit the business made over a period of time. All income and expense accounts are used to produce the report. The resulting profit figure could be used as a basis for calculating any corporation tax due.

Each financial period in your business should be consolidated once you have entered all the transactions. This transfers the overall profit figure into your "Profit and loss" account and resets all your income and expense accounts to zero at the start of the new financial period.

What does the line "Opening Balances" indicate?

It is possible to make errors in the initial setup of opening balances such that your accounts are not in balance. If this is the case, Easy Books shows a line labelled Opening Balances at the end of the report, together with the amount needed to bring the accounts back into balance. You should review your opening balances if this line appears.

Every transaction moves money from one account to another without loss. For example, if you pay dividends, you will normally pay these as a transaction between your Bank account and one of your Capital / Net Worth accounts, such as your Retained profit account. The balance of both accounts is affected by the same amount because the double-entry system is managed by Easy Books. This is not the case for your Opening Balances. If you are setting opening balances, be careful to use the correct figures for all accounts so the accounts are still in balance. Use the Trial Balance report to check. If the Opening Balances line appears, your accounts are not balanced.

How does Easy Books pick the initial date range?

The Next Consolidation date (shown in the report settings and in the Business Settings) is used as the end date of the report. If this date has not yet passed, the report uses current date instead. If you've consolidated your profit and loss, the day after your last consolidation is used as the start date. Otherwise the date of the earliest transaction is used.


Options in this Screen

Previous Period/Next Period

Click to view the report for the previous or next financial period. The report will run for the whole of the financial period selected.

Start Date

You can set the start date to any date prior to the currently-selected end date.

End Date

You can set the end date to any date after the currently-selected start date.

Show Contained

If you have any accounts in a container account, only the total for the container is presented in the report. Use this option to show all the individual accounts. For information about container accounts, please refer to "Adding or Editing an Account".

Show Comparison

You can add a comparison period to the report using this option. This is typically used to compare accounts from one financial year to another.

You can set the start date to any date prior to the currently-selected comparison end date. You can set the end date to any date after to the currently-selected comparison start date.

Undo Last Consolidate

Consolidating a financial period locks transactions up to that date so they cannot be changed accidentally. Use the Undo Last Consolidate option if you need to make a change to a previously consolidated period.

Consolidate

This option is available if the Next Consolidation date has passed.

Consolidating adds a "P/L Consolidation" transaction to each income and expense account, which sets the balance to zero for the start of the next financial period. The same transaction is also added to the "Profit and loss" account. These transactions can be viewed, but not changed, since the consolidation puts a lock on all transactions dated before the end of the period. In addition, no new transactions can be added with a date that is prior to the consolidation date.


Further Information

For details of how to carry out tasks in the Profit and Loss screen, please refer to: