Budgets & ratio analysis

Two reports help you read your books like an analyst, both under Reports: a set of financial ratios and a budget vs actual comparison. Both read straight from your double-entry books, so they're current the moment you open them.

Ratio analysis

Open Ratio analysis, pick a date range, and Finocket works out the standard ratios accountants use, grouped into:

• Profitability — net profit margin, return on equity, return on assets.
• Liquidity — current ratio and quick ratio (can you cover what you owe?).
• Leverage — debt-to-equity and debt ratio.
• Efficiency — expense ratio and asset turnover.

Each ratio shows its value and the formula behind it, and reads NA when there isn't enough data to compute it (for example a ratio that would divide by zero).

Budgets & variance

Open Budgets & variance to set a budget — for the whole business, a specific ledger account, or an expense category — for a month or a year. Finocket then compares your budget to what actually happened and shows the variance, flagging where you're over or under. It's the quickest way to keep spending on plan.