The nvisin tool for this: Monthly Review. Monthly financial review for accounting firms.
Most business owners can tell you their revenue last month. Far fewer can tell you their gross margin, how long customers take to pay, or how much cash they'll have in six weeks. A monthly dashboard puts those few numbers in front of them, every month, in the same place.
The hard part is choosing them. Too many and the dashboard becomes a report nobody reads. Too few, or the wrong ones, and it misses what's actually happening. Here's how to choose, by industry. The core six sit at the top of every Monthly Review portal.
The core six
| KPI | Definition | What it tells the owner |
|---|---|---|
| Revenue | Total income for the month | Are we growing? |
| Gross margin | (Revenue − cost of sales) ÷ revenue | Are we pricing and delivering profitably? |
| Net income | Profit after all expenses | Did we make money? |
| Cash | Bank balances at month-end | What do we actually have? |
| Receivable days | AR ÷ revenue × days in the month | How long are customers taking to pay? |
| Payable days | AP ÷ cost of sales and expenses × days in the month | How long are we taking to pay suppliers? |
Show margins in percentage points when comparing ("down 1.1 points"), and show each KPI against last month and the same month last year.
Extra KPIs by industry
Add one or two that the owner already talks about. If they don't recognise a KPI, they won't act on it.
| Industry | KPIs worth adding | Why |
|---|---|---|
| Professional services | Revenue per employee; unbilled work (WIP) | People are the cost; unbilled time is cash waiting |
| Construction | Gross margin by job; backlog; retainage receivable | Profit is made or lost job by job; backlog is next quarter's revenue |
| Retail and e-commerce | Inventory days; ad spend as % of revenue; average order value | Stock ties up cash; ad spend can quietly eat margin |
| Restaurants | Food cost %; labour cost %; prime cost (both together) | The two costs that decide whether a restaurant makes money |
| Healthcare clinics | Revenue per provider; collections as % of billings | Capacity and how much billed work is actually collected |
| Property management | Doors under management; revenue per door | Growth and pricing in one view |
Defining them properly
- Write the formula down, once, and use it every month. Receivable days calculated three different ways is three different numbers.
- Decide what's in each line. Is owner salary in operating expenses or below the line? Is the credit line in cash? Pick, and note it.
- Use closed months only. A KPI from an unreconciled month will change, and the client will remember the first number.
- Smooth the noisy ones. For receivable days in a lumpy business, use the average of the last three months' revenue.
A worked example
Here's the September dashboard for a fictional services business, Harbor & Pine Co.:
| KPI | September | vs August | vs last September |
|---|---|---|---|
| Revenue | $148.2k | +4.1% | +27% |
| Gross margin | 30.6% | −1.1 pts | −0.4 pts |
| Net income | $17.7k | −19.8% | +12% |
| Cash | $151k | −$6k | +$38k |
| Receivable days | 34.7 | +4.2 days | +2.1 days |
| Revenue per employee (annualised) | $127k | +4% | +9% |
Receivable days are $171,400 of receivables ÷ $148,200 of revenue × 30 days. Revenue per employee is the month's revenue × 12 ÷ 14 staff. The flags tie to the commentary: margin and profit dipped for one-off reasons, and customers are paying a little slower as the Q4 invoices go out. How to write that commentary is covered in Writing month-end commentary clients actually read, and the review behind it in How to review a client's P&L every month.
Common mistakes
- Too many KPIs. If the owner can't name them, there are too many.
- KPIs with no comparison. 34.7 receivable days means nothing on its own.
- Industry KPIs the owner doesn't use. Ask what they already track before adding anything.
- Changing definitions. A KPI that's calculated differently this month is a different KPI.
- A dashboard with no words. Numbers show what happened; a sentence beside them says why.
Frequently asked questions
What KPIs should be on a small business financial dashboard?
Most small businesses need revenue, gross margin, net income, cash, receivable days (how long customers take to pay) and payable days (how long the business takes to pay suppliers), each compared with last month and the same month last year. Add one or two industry-specific KPIs.
How many KPIs should a client dashboard have?
Four to six. Enough to show the health of the business at a glance, few enough that the owner remembers them. More detail belongs in the full statements.
How do you calculate receivable days?
A simple monthly version is accounts receivable at month-end divided by the month's revenue, multiplied by the number of days in the month. Using the average of the last three months' revenue smooths out lumpy months. Whichever you use, use it every month.
Should KPIs be compared with last month or last year?
Both, where possible. Last month catches sudden changes; the same month last year removes seasonality. A target or budget, if the client has one, is a useful third comparison.