Introduction<\/strong><\/p>\n Having accurate financial information is essential for making sound business decisions. However, simply recording transactions and producing annual financial statements may not give business owners enough insight into how their company is performing throughout the year.<\/span><\/p>\n This is where management reporting becomes valuable.<\/span><\/p>\n Management reports provide a regular view of revenue, expenses, profitability, cash flow, budgets and key performance indicators (KPIs). For businesses using Xero, integrating accounting information with Fathom can make it easier to analyse financial data and present important business insights in a clear format.<\/span><\/p>\n For Singapore SMEs, startups and growing companies, a well-structured Xero and Fathom reporting process can help management identify financial trends, investigate unusual results and make better-informed decisions.<\/span><\/p>\n If setting up the system or preparing reports is taking too much time, professional assistance from WLP can help businesses establish a practical and reliable reporting process.<\/span><\/p>\n\n Management reporting involves preparing financial and business information for owners, directors and managers.<\/span><\/p>\n Unlike statutory financial statements, which are primarily prepared to meet accounting and regulatory requirements, management reports are designed to support internal decision-making.<\/span><\/p>\n A monthly management report may include information about sales, gross profit, operating expenses, net profit, cash flow, outstanding receivables, outstanding payables and budget performance. Businesses can also include industry-specific KPIs to provide a more complete picture of operational performance.<\/span><\/p>\n The purpose is simple: management should be able to look at the report and understand what is happening in the business, where performance has changed and whether action is required.<\/span><\/p>\n\n Xero provides the accounting foundation for the business, while Fathom provides tools for financial analysis, KPIs, visualisation and reporting.<\/span><\/p>\n Fathom integrates with Xero so that financial information can be brought into Fathom for further analysis. This can reduce the need to manually transfer accounting figures into spreadsheets every month.<\/span><\/p>\n Once the integration and reporting structure are properly configured, the process can become much more efficient. Accounting information recorded in Xero can feed into the reporting process, while Fathom can be used to analyse the information and produce management-friendly reports.<\/span><\/p>\n This creates a simple workflow from accounting data to financial analysis and ultimately to business decisions.<\/span><\/p>\n Step 1: Review Your Xero Accounting Records<\/strong><\/p>\n Before setting up management reporting, make sure the accounting information in Xero is reliable.<\/span><\/p>\n Review whether bank accounts have been reconciled and whether sales, expenses, bills, invoices, payroll transactions and other important entries have been recorded correctly.<\/span><\/p>\n It is also useful to review unusual balances, suspense accounts and incorrectly classified transactions.<\/span><\/p>\n This is particularly important because Fathom’s reports depend on the information coming from the accounting system. If the underlying bookkeeping is incomplete or inaccurate, the resulting management report may also provide an inaccurate view of the business.<\/span><\/p>\n A strong management reporting system therefore begins with clean and properly maintained accounting records.<\/span><\/p>\n Step 2: Connect Xero With Fathom<\/strong><\/p>\n Once the Xero accounts are ready, the next stage is connecting the business’s Xero organisation to Fathom.<\/span><\/p>\n The general process involves signing into Fathom, selecting Xero as the accounting data source and authorising the connection. The relevant Xero organisation can then be selected for the reporting setup.<\/span><\/p>\n Fathom can import information such as the Chart of Accounts and financial data from Xero. The available features can vary depending on the Fathom subscription and configuration.<\/span><\/p>\n After the connection has been established, review the imported information before creating your reports.<\/span><\/p>\n Step 3: Organise the Chart of Accounts<\/strong><\/p>\n A well-organised Chart of Accounts makes financial reporting easier to understand.<\/span><\/p>\n Instead of simply looking at individual accounting codes, management may want expenses and income grouped into meaningful categories.<\/span><\/p>\n For example, revenue could be separated into product sales, service income or recurring revenue. Direct costs might include materials and subcontractor expenses, while operating costs could include salaries, rent, marketing and technology expenses.<\/span><\/p>\n The appropriate structure will depend on the business.<\/span><\/p>\n A professional services company, for example, may need a different reporting structure from a retail business or construction company.<\/span><\/p>\n The objective is to make the financial information useful for management rather than simply reproducing an accounting ledger.<\/span><\/p>\n Step 4: Decide Which KPIs Matter<\/strong><\/p>\n Good management reporting does not require every possible metric.<\/span><\/p>\n Instead, select KPIs that help management understand the factors that influence business performance.<\/span><\/p>\n Common financial KPIs include revenue growth, gross profit margin, net profit margin, EBITDA, operating expenses and cash flow.<\/span><\/p>\n Businesses may also monitor non-financial indicators. A service company could track billable hours, utilisation or revenue per employee, while a retail business may focus on average transaction value, inventory turnover and sales growth.<\/span><\/p>\n The most useful KPIs are those that encourage management to take action.<\/span><\/p>\n If a particular metric does not influence any business decision, there may be little reason to include it in the monthly report.<\/span><\/p>\n Step 5: Set Up Budget Comparisons<\/strong><\/p>\n A management report becomes more useful when actual performance can be compared with planned performance.<\/span><\/p>\n If the company has prepared an annual or monthly budget, compare actual revenue and expenses against the budgeted amounts.<\/span><\/p>\n For example, if revenue is below expectations, management can investigate whether this was caused by lower sales volumes, changes in pricing, delayed projects or seasonal factors.<\/span><\/p>\n Likewise, if expenses are significantly above budget, management can determine whether the increase was temporary or represents an ongoing cost issue.<\/span><\/p>\n The purpose of budget analysis is not simply to highlight differences. It is to understand the reasons behind those differences.<\/span><\/p>\n Step 6: Use Tracking Categories Where Appropriate<\/strong><\/p>\n Businesses that operate across multiple locations, departments, projects or divisions may need more detailed reporting.<\/span><\/p>\n Xero tracking categories can help businesses classify financial transactions according to different areas of the organisation. When configured appropriately, this information can also support more detailed analysis in Fathom.<\/span><\/p>\n For example, a business could analyse different branches, departments, service lines or geographical operations.<\/span><\/p>\n This can help management identify which parts of the company are generating revenue, contributing to profit or creating higher-than-expected costs.<\/span><\/p>\n However, tracking categories should be planned carefully. Creating too many categories can make bookkeeping more complicated and may reduce the usefulness of the resulting reports.<\/span><\/p>\n Step 7: Build a Practical Management Report<\/strong><\/p>\n Once the accounting data, KPIs and reporting structure are ready, create a management report that is easy for decision-makers to understand.<\/span><\/p>\n Start with an executive summary that explains the most important developments during the reporting period.<\/span><\/p>\n Next, present the company’s financial performance, including revenue, gross profit, operating expenses and overall profitability.<\/span><\/p>\n The report can then cover cash flow, budget performance and selected KPIs.<\/span><\/p>\n If the business has multiple divisions or locations, include a relevant comparison so management can see how each area is performing.<\/span><\/p>\n Finally, add management commentary.<\/span><\/p>\n This section is particularly important because financial figures alone do not explain why results changed. Commentary can identify significant movements, explain the underlying reasons and highlight areas requiring management attention.<\/span><\/p>\n Step 8: Create a Recurring Reporting Template<\/strong><\/p>\n There is little benefit in designing a detailed report from scratch every month.<\/span><\/p>\n After creating a management report that suits the business, turn it into a repeatable reporting format.<\/span><\/p>\n A recurring process might involve completing month-end bookkeeping, reconciling accounts, updating the Xero data in Fathom, reviewing KPIs, analysing budget variances and preparing the final management report.<\/span><\/p>\n Using a consistent structure also makes it easier to compare one month with another.<\/span><\/p>\n Over time, management can identify trends rather than focusing only on individual monthly results.<\/span><\/p>\n Step 9: Keep the Reporting Process Up to Date<\/strong><\/p>\n Financial reporting works best when accounting information is updated consistently.<\/span><\/p>\n Depending on the configuration, Fathom can update information from Xero automatically or through manual updates.<\/span><\/p>\n However, automation should not be confused with financial review.<\/span><\/p>\n Even when data transfers automatically, someone should still review the accounting records and investigate unusual results before management relies on the report.<\/span><\/p>\n Technology can make reporting faster, but professional judgement remains important.<\/span><\/p>\n What Should a Singapore Business Include in Its Management Report?<\/span><\/p>\n There is no single management reporting format that works for every company.<\/span><\/p>\n For many Singapore SMEs, a monthly report could include a Profit and Loss statement, Balance Sheet, cash flow information, revenue performance, gross profit margin, operating expenses, accounts receivable, accounts payable and budget-versus-actual analysis.<\/span><\/p>\n Businesses may also include selected KPIs, divisional performance and commentary on significant financial movements.<\/span><\/p>\n The report should be tailored to the needs of the business owner or management team.<\/span><\/p>\n A concise report containing the right information is generally more useful than a lengthy document filled with figures that nobody reviews.<\/span><\/p>\n\n Using Xero and Fathom together can provide several practical benefits.<\/span><\/p>\n Better Financial Visibility<\/strong><\/p>\n Regular reports provide management with a clearer view of business performance throughout the year instead of waiting until the end of the financial period.<\/span><\/p>\n Faster Identification of Problems<\/strong><\/p>\n Unusual expenses, declining margins, falling revenue or growing receivables can be identified earlier when financial information is reviewed regularly.<\/span><\/p>\n More Effective Budget Management<\/strong><\/p>\n Comparing actual performance with the budget helps management determine where the business is performing ahead of expectations and where corrective action may be necessary.<\/span><\/p>\n Improved Business Decision-Making<\/strong><\/p>\n Clear financial information can support decisions about hiring, pricing, expansion, cost control, investments and cash management.<\/span><\/p>\n Less Manual Reporting<\/strong><\/p>\n Once the integration and report structure have been properly established, businesses can reduce repetitive spreadsheet work and create a more consistent reporting process.<\/span><\/p>\n\n Relying on Unreconciled Accounting Data<\/strong><\/p>\n Reports should not be treated as reliable until the underlying accounting records have been reviewed.<\/span><\/p>\n Including Too Many KPIs<\/strong><\/p>\n An excessive number of metrics can make a report difficult to interpret. Focus on the indicators that genuinely matter to the business.<\/span><\/p>\n Looking Only at Profit<\/strong><\/p>\n Profitability is important, but cash flow should also be monitored. A company can report accounting profit while experiencing short-term cash pressure.<\/span><\/p>\n Ignoring Variances<\/strong><\/p>\n Large differences between actual results and the budget should be investigated rather than simply recorded.<\/span><\/p>\n Preparing Reports Without Commentary<\/strong><\/p>\n Numbers show what happened, but management commentary can explain why it happened and what should happen next.<\/span><\/p>\n\n For business owners, setting up Xero and Fathom is only one part of the process. The more important question is whether the reporting system provides information that management can actually use.<\/span><\/p>\n WLP can assist Singapore businesses with accounting, bookkeeping, Xero support and financial reporting requirements. Our services can help businesses maintain accurate accounting records while developing reporting processes that support management decision-making.<\/span><\/p>\n Professional accounting support can be particularly useful if you need assistance with cleaning up Xero data, reviewing the Chart of Accounts, establishing reporting categories, developing KPIs or preparing regular management reports.<\/span><\/p>\n WLP can also assist businesses that need broader financial support, including bookkeeping, financial statement preparation, budgeting, forecasting and financial analysis.<\/span><\/p>\n For companies without a dedicated internal finance team, working with an experienced accounting provider can make it easier to maintain a consistent month-end reporting process.<\/span><\/p>\n\n The overall process can be kept straightforward.<\/span><\/p>\n Start by maintaining accurate accounting records in Xero. Reconcile the accounts and review important transactions before the reporting period is closed.<\/span><\/p>\n Next, update the relevant information in Fathom and review the company’s financial performance.<\/span><\/p>\n Analyse revenue, profitability, expenses, cash flow, KPIs and budget variances.<\/span><\/p>\n After that, prepare the management report with clear commentary explaining the most important changes.<\/span><\/p>\n Finally, use the report during management discussions to determine what actions should be taken.<\/span><\/p>\n The goal is to turn financial information into an ongoing management tool rather than a document that is prepared simply for record-keeping purposes.<\/span><\/p>\n\n Can Xero integrate with Fathom?<\/strong><\/p>\n Yes. Fathom provides an integration with Xero that allows financial information from Xero to be brought into Fathom for analysis and reporting.<\/span><\/p>\n What can Fathom be used for?<\/strong><\/p>\n Fathom can be used for financial analysis, KPI monitoring, budgeting, forecasting and customised management reporting, depending on the features available under the relevant subscription.<\/span><\/p>\n Can Xero and Fathom be used for monthly management reports?<\/strong><\/p>\n Yes. Businesses can establish a recurring monthly process in which updated Xero accounting information is analysed in Fathom and incorporated into management reports.<\/span><\/p>\n Can I compare actual performance with my budget?<\/strong><\/p>\n Yes. Budget information can be incorporated into Fathom so that management can compare actual results with planned performance and analyse significant variances.<\/span><\/p>\n Can different departments or locations be reported separately?<\/strong><\/p>\n Yes. Businesses can use appropriate Xero tracking categories and Fathom reporting features to analyse different parts of the organisation.<\/span><\/p>\n Does using Xero and Fathom eliminate the need for an accountant?<\/strong><\/p>\n Not necessarily. Software can automate data processing and make reporting more efficient, but an accountant can provide professional judgement, review the quality of the underlying records and help management interpret financial results.<\/span><\/p>\n How often should management reports be prepared?<\/strong><\/p>\n Monthly reporting is a practical option for many SMEs because it provides regular visibility without creating excessive administrative work. Businesses with more rapidly changing financial conditions may benefit from more frequent monitoring.<\/span><\/p>\n\n A combination of Xero and Fathom can make management reporting more organised, visual and efficient. However, successful reporting depends on more than simply connecting two software platforms.<\/span><\/p>\n Businesses need accurate accounting records, an appropriate Chart of Accounts, relevant KPIs, meaningful budget comparisons and clear financial commentary.<\/span><\/p>\n For Singapore SMEs and growing businesses, professional support can make the process easier and help ensure that management reports are focused on information that actually supports decision-making.<\/span><\/p>\nWhat Is Management Reporting?<\/b><\/h4>\n
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Why Use Xero and Fathom Together?<\/b><\/h4>\n
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Benefits of Xero and Fathom Management Reporting<\/b><\/h4>\n
Common Mistakes to Avoid<\/b><\/h4>\n
How WLP Can Assist With Management Reporting<\/b><\/h4>\n
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A Simple Xero + Fathom Reporting Process<\/b><\/h4>\n
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Frequently Asked Questions About Xero and Fathom Reporting<\/b><\/h4>\n
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Final Thoughts<\/b><\/h4>\n