Start with reporting status and the decisions due
Confirm the period, version and preparation status before interpreting performance. Identify material estimates, unreconciled balances and missing information. A CFO should know which figures are ready for a decision and which may change. Discuss the deadline for resolving gaps rather than treating a provisional report as final.
List the decisions due before the next review: pricing, recruitment, purchasing, funding or investment. This gives the meeting a purpose and determines which supporting schedules deserve attention. The same pack will not suit every SME. For the underlying statements and an illustrative download, see our monthly management accounts example.
For the workflow before the review, read how to prepare monthly management accounts.
The monthly CFO reporting checklist
| Report | Question to challenge | Decision or follow-up |
|---|---|---|
| Profit and loss: month and year to date | Is the variance caused by price, volume, mix, cost, timing or an accounting issue? | Allocate investigation and any pricing or resource decision. |
| Balance sheet and reconciliations | Are debtors, stock, creditors and other material balances supported? | Resolve aged items and assess working capital exposure. |
| Actual cash and profit-to-cash bridge | Why did bank cash move differently from profit? | Investigate collections, commitments, tax, investment and financing. |
| Rolling cash and financial forecast | When is the low point, and which assumptions could change it? | Assess commitments and review a connected downside. |
| Operational KPIs | Do customer, channel, project or capacity measures explain the financial result? | Assign an operational action using consistent definitions. |
| Actions and material risks | What remains unresolved from the last review? | Confirm owners, dates and escalation conditions. |
Where borrowing or transaction conditions apply, include the relevant schedules and definitions. Do not assume a general dashboard meets a lender’s reporting requirements. Agree those requirements with the appropriate parties.
Challenge the result before accepting the explanation
A report may show higher revenue and lower profit. The CFO should ask for the bridge: price, volume, product or client mix, delivery costs and overheads. Avoid attributing the movement to sales or operations before the evidence supports it. Check for changes in cut-off, accruals and classification that could affect comparison.
In a hypothetical SME, revenue is £110,000 against £100,000 budget. Gross profit is £38,500 against £40,000 and overheads are £26,000 against £25,000. Operating profit is therefore £12,500 against £15,000. The useful question is what explains the £2,500 shortfall despite higher sales. These figures illustrate a review, not a client outcome or performance benchmark.
Use the balance sheet to explain the cash story
Inspect debtor ageing, stock or project balances, supplier obligations and other material accounts alongside profit. A change in total debtors does not reveal whether it is caused by growth, overdue invoices or a disputed balance. Ask for the supporting analysis and evidence of collection where appropriate.
Keep actual bank cash separate from the forecast. A positive month-end balance does not establish that the next payroll and investment commitments are covered. Review the dated low point and key assumptions. For tight or fast-changing cash positions, a weekly cash meeting can complement the monthly review rather than waiting for another month-end pack.
Connect the forecast with operational evidence
Compare the latest forecast with the previous version and the original budget. Explain changes in assumptions, not only the new total. Signed orders, renewals and early sales opportunities should not carry the same confidence without analysis. Include the capacity, management cost and working capital needed to deliver growth.
Use a small set of relevant KPIs. An agency may need project contribution and utilisation; an ecommerce brand may need contribution after advertising, returns and stock commitments. Document definitions and reconcile financial measures to the accounts. If a KPI improves while company profit deteriorates, investigate the scope and timing before celebrating the metric.
Close with an action record the next meeting can review
For each material issue, state the evidence, decision required, responsible person and date. Separate an approved action from an option still being evaluated. A forecast that assumes a supplier payment extension is different from one supported by an actual agreement.
An illustrative action might read: ‘Commercial lead to reconcile price and sales mix by the next pricing review; finance to update the collection dates and show the cash effect before recruitment is approved.’ Review completion and the result at the next meeting. Consult EFC can discuss monthly reporting support or ongoing outsourced FD involvement, with scope and responsibilities agreed first.
Your next-review checklist
- Confirm period, version and unresolved accounting items.
- Connect profit, balance-sheet movements and actual cash.
- Review the forecast low point and a plausible downside.
- Assign decisions and follow-up to named owners and dates.
Frequently asked questions
Which financial reports should a CFO review every month?
Review profit and loss, balance sheet, actual cash movements, a rolling forecast, relevant KPIs and the action log. Add supporting schedules for material issues and any agreed external reporting requirements.
Is a KPI dashboard enough for a monthly CFO review?
Usually it is only part of the picture. The reviewer also needs reliable financial statements, reconciliations, a cash view and the assumptions behind the forecast.
Should the CFO prepare every report personally?
Not necessarily. Preparation, review and decision support can be allocated across the team. Agree information owners, checks and responsibilities in the engagement.
Do monthly reports replace a weekly cash forecast?
No. Monthly performance and weekly cash timing answer different questions. Use the frequency needed for the company’s decisions and exposure.
Sources and further reading
The worked examples and meeting formats are original hypothetical illustrations for preparation and discussion, not client outcomes or a required format for every business.
Scope, evidence and responsibilities should be agreed for the company. These resources provide background and do not imply endorsement of this website.
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