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What is Financial DataFinancial Data contains information integral to understanding your business’s financial health and well-being. Such information can be obtained from internal and external sources, notably from traditional sources. This information includes your business income statement, balance sheet, and cash flow statement. Count the alternative data sources or the data outside your company in too. With your financial data, you can determine whether your business is progressing or on track. This will help you make informed decisions regarding your future investments and expansions.
Types of Financial DataThere are two broad categories of financial data: Traditional data and Alternative data.
Traditional dataTraditional data refers to financial data from traditional sources. These sources can pertain to SEC filings, press releases and financial statements. Some common types of traditional financial data include income, expenses, assets, liabilities, cash flow, and equity.
- Income refers to the company’s increase in wealth generated from sales and investments.
- Expenses refer to the cost of operations of a business.
- Assets comprise everything a company owns, including its personal, real, tangible, and intangible property.
- Liabilities refer to a business’s financial obligations or what it owes to others.
- Cash flow shows where a business’s income and expenses are coming from.
- Equity refers to the amount of money left over if all of a corporation’s debts were paid off and all of its assets were liquidated.
Alternative dataThis refers to external data that investors use to assess and monitor the health of a company, industry, or investment outside of traditional sources, like SEC filings and financial statements. Alternative data, such as web data, geolocation data, credit card transactions, social media data, product reviews, email receipts, and satellite imagery, provides accurate and timely insights that give investors an edge. Alternative data can be acquired in three significant ways: Web scraping, Raw Data Acquisition and Licensed Third Parties.
Understanding the Need For Financial Data or Statements to Get Funding For Your Business GrowthRegardless of your business size, keep in mind that your financial data or statements play a crucial role in your business’s ability to secure investments. It is data you will need to obtain the funds or financing you need to grow or expand. Likewise, note that when you apply for funding, you will be required to submit both your historical financial data or statements and the projected financial figures of your business. That said, entrepreneurs or business owners like you should clearly understand these four types of salient financial statements you need to provide for your potential investor, creditor, or lender.
Income StatementThe income statement of your business is the most critical financial statement you can provide to lenders or investors. When applying for business funding, this gives insights into your business’s financial performance over a specific period of time. This discloses whether your business can produce profits. It also underlines whether the profitability of your business is sustainable. Your income statement can be divided into three main sections. These sections are the revenue, expenses, and net income. Revenue is what your business brings in through its sales of products and services. Expenses are costs associated with running your business. Finally, net income is the difference between revenue and expenses.
Cash Flow StatementThe Cash Flow Statement (CFS) estimates how well your business can generate cash to cover its liabilities and fund its operating expenses. It also concentrates solely on the inflow and outflow of money, which is a good barometer for investors and lenders to use for evaluating how your business is running.
Balance SheetYour business’ balance sheet is vital information for lenders and investors. Lenders and investors will review your balance sheet and income statement to determine how much of an investment in assets and liabilities is required. They’ll also look at your liquidity. Your ability to pay back loans and repay debts will be checked. This will help them decide whether to invest in your business. A healthy balance sheet signifies that your business is solvent too. This means it has the resources to cover its debts and expenses.
Statement of Owner’s EquityAlso known as a Statement of Shareholders’ Equity, this financial statement showcases your business’s retained earnings, including the profit kept within your SME company. Likewise, a Statement of Owner’s Equity (SOE) also shows how much money your business can reinvest and pay its debts.
How MoolahMore Can Help You Fund Your BusinessMoolahMore is a simple, brilliant cash flow tool that uses advanced mathematical methods and informed predictive algorithms and is jam-packed with powerful features. Here’s a run-through of the powerful features of MoolahMore and how it can help you quickly build and prepare data-driven financial statements relevant to get financial backing for your business growth:
- User-friendly dashboards for both mobile and web interface
- Cash flows are visually and graphically presented, so it’s easier to track and analyse your business income, expenses, cash balance and other relevant financial key metrics.
- Real-time view of your business cash flow at any period
- Utilises Comparative analysis where you can create reports in minutes to identify opportunities or risks with real-time financial data
- “What if” scenario builders, transaction editors and forecasting capabilities that allow you to explore different outcomes for your business and determine the best path forward
- Multiple currencies to gain insights into your global cash position.
- Integration with other leading accounting software (MYOB, Xero and QuickBooks)
- The servers and databases of MoolahMore are hosted in the cloud, so your information is safe and protected.
- Developed to run on both mobile and web devices, making it accessible for you at any time and anywhere