Profitability Analysis

Profitability Analysis takes the same income and expense entries as the Profit and Loss Statement and slices them by a dimension: cost center, project or any custom Accounting Dimension such as branch. It is the report that tells a Nepali owner with a Kathmandu office and a Pokhara counter which one really earns, or whether a trekking project made money after guide costs. Each GL Entry carries the cost center or project it was tagged with, so untagged vouchers fall into a blank column and the analysis is only as complete as your tagging discipline. Shared costs such as rent must be spread with a Cost Center Allocation or they sit entirely on the head office.

Profit per dimension = Income tagged to the cost center or project - Expenses tagged to it, from GL Entry for the period

1. 01Go to Financial Reports > Profitability Analysis.
2. 02Set Company, Fiscal Year 2083-2084 and From Date and To Date.
3. 03Set Based On to Cost Center, Project or an Accounting Dimension such as Branch.
4. 04Read one column per cost center: Main - YFF and Marketing - YFF in the demo.
5. 05Look at the blank column for vouchers without a tag and fix them by amending or with a Journal Entry.
6. 06Set up Invoicing > Cost Center Allocation so shared costs are split instead of sitting on head office.
7. 07Export with Menu > Export for the management meeting.

Open to ask which branch, project or department actually earns money.

Tag invoices with a Pokhara cost center and the Rs 64,000 revenue is shown against it.