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The information the management presents should be divided into two separate reports.

1. Information about the latest quarterly accounts compared to budget and with comments on the main deviations – including % deviation from budget.

a. Profit and loss statement (maximum one A4 sheet)
Comments should include, as a minimum:
-Turnover per product group and in total.
-Changes in stock.
Without these, the picture is incomplete.
- Realised contribution and contribution margin in total and, preferably, by product group
- Fixed overheads, with specification of staff and energy costs
- Depreciation (If there are no significant deviations in investments, the budget figures can be used).
- Interest charges
- Result before company tax.
- Estimate of the results for the year

b. Balance sheet
- Comments must include, as a minimum, the most important balance sheet entries
- Debtors, if appropriate specified as outstanding and doubtful.
- Bank debt/overdraft (current interest rate and statement of maximum drawing right)

Both a and b are summaries of the edp balance sheet, and should take up no more than one sheet of A4

c. Overview of liquidity position (maximum one A4 sheet).
- Estimated liquidity requirements within the next 2-4 months including planned and expected investments and any deviation from plan.

Proposal concerning the expectations of the management as to how any shortfall in liquidity can be met.

2. Management's written report (1-2 A4 sheets).

a. Organisation:

Employment and dismissals as well as problems with key personnel and any disputes with unions, accidents at work etc. Absences due to illness in %. Use of capacity and any considerations about changes, new acquisitions, extensive repair and maintenance work, etc.

c. Customers/sales:

How will we compare to budget over the next 3–6 months on the basis of the information currently available? New initiatives for increased sales activity. Representation at trade fairs. Customers' opinions. Problems with maintaining profits, if any. NB: Our performance during the last quarter belongs under the comments on the accounts. Competition, competitors' main initiatives.

d. Key points for any items the management wishes to raise

e. Other points:

Any important information of significance to the company or the members of the board. The chairman of the board should be given a briefing over the telephone before the documents are finalised and sent out, so that he is not "caught out" during the meeting.

Sending the report in advance creates the following benefits:

  • Everyone is well-prepared for the meeting, including the management itself
  • Everyone has the same starting point

An action plan should always be drawn up for the broad themes decided by the board for the next twelve months .

HMC´s checklist can be copied from this site and used for work within your own company.