Financial Reports

Revenue, Costs, and Net Profit Over a Period

Go to Accounting > Reporting > Profit and Loss. Unlike the Balance Sheet, this report always covers a date range (default: this fiscal year to date).

The Waterfall

1. Revenue – all income accounts.
2. Less Cost of Revenue – direct costs of what you sold.
3. = Gross Profit
4. Less Operating Expenses – overhead, salaries, rent, etc.
5. = Operating Income (or Loss)
6. Plus Other Income / Less Other Expenses – non-operating items (interest, one-off gains/losses).
7. = Net Profit

This Net Profit figure — scoped to the current fiscal year — is exactly what the Balance Sheet's "Net Income (Current Year)" line pulls in live.

Comparing Periods

Use the comparison filter to add columns for prior months/quarters/years side by side — the fastest way to spot a cost that's crept up or a revenue line that's slipping, rather than staring at one period in isolation.

Budgets on the P&L

If budgets are configured (see the Budgets course), enable "Show Budgets" to add a Budget column and variance alongside Actuals directly on this report.

Two Optional Extras Beyond the Standard Setup

Automatic Fiscal Year Creation

If you use explicit Fiscal Year records (rather than just the simple month/day setting covered earlier in this course) — for example to model a genuinely irregular fiscal calendar — a scheduled action can automatically create each new fiscal year's record ahead of time based on your existing pattern, so nobody has to remember to set one up manually before the current one ends.

The Formal Closing Wizard

As explained earlier in this course, the Balance Sheet's Retained Earnings/Net Income split is computed live, with no closing journal entry required — this is the standard, recommended approach and needs nothing further from you.

A separate, optional Fiscal Year Closing wizard also exists (Accounting > Actions > Fiscal Year Closing) for businesses whose jurisdiction or auditor specifically requires formal, posted closing and opening journal entries at year-end, rather than relying on a dynamically-computed report. It generates configurable closing entries per a template, moves through Draft → Processed → Posted, and tags the resulting entries with a Closing Type for identification.

Important: Don't Use Both Approaches Carelessly

If you post formal closing entries with this wizard, their counterpart must go to the same "Undistributed Profits/Losses" equity account that the dynamic Balance Sheet calculation already excludes from its own prior-year rollup — otherwise the same year's earnings can get counted twice (once by the live calculation, once by the posted closing entry), throwing the Balance Sheet out of balance. Unless your accountant or jurisdiction specifically requires formal closing entries, the simplest and safest approach — used throughout this course — is to rely on the live calculation alone and skip this wizard entirely.

Why the Fiscal Year Matters

Every report that splits "current year" from "prior years" — most importantly the Balance Sheet's equity section — relies on knowing exactly when your fiscal year starts and ends. Most companies close on December 31, but plenty don't: some countries and industries commonly use a different date (for example, many private companies in some countries use June 30).

Setting It

1. Go to Settings > Invoicing > Fiscal Periods.
2. Set the Fiscal Year field: a month and a day (e.g. December 31, or June 30).
3. This is per-company — each company in a multi-company setup can have its own fiscal year end.

This one setting is what every report uses to decide what counts as "this year" versus "prior years" — get it right before relying on the Balance Sheet's Retained Earnings/Net Income split (next article) or the Profit and Loss report's default "This Year" filter.

Changing It Later

Changing the fiscal year end after you already have a full year of transactions will shift what every report considers "current year" going forward. Do this deliberately (e.g. at a genuine change of accounting period) rather than casually — it's a real accounting decision, not just a display preference.