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Chapter 16




by josavere

Aspect of great importance practical to obtain the objectives of value generationis the periodic analysis of the earnings statement (generally every month) to be evaluating as advance in the annual exercise in terms of working days and making decisions logics, oriented to the continuous improvement.

For it, he is very recommendable to have a comparison pattern, which takes shape with two parameters that is to say: the earnings statement of the previous exercise (where we are) and the projected one for the exercise in course (to where we want to arrive) in agreement with the strategic planning. For both cases a vertical analysis is fundamental that it indicates the participation of each one of the debits as percentage of the income and allows us to make cuestionamientos to the games that do not obey to a logic.

If for example, the expenses of sales for the previous period are equivalent to 13% of the sales, because they are going to represent 7% in this one accumulated period or the month that we analyzed?

This type of questions is taking to find a logic to us to accept or to reject a number that leaves normal conditions, unless an acceptable explanation appears, reason why is very recommendable to both compare the results of the month in study with parameters, being done emphasis in the accumulated period. For it it is important to consider the following considerations:

Accepting the difficulty practical of the accounting to accurately measure the results of a company (unless very a well designed software is used) and theurgent necessity to know the advance the business to take actions from improvement, he is advisable to understand, of the best possible way, which indicates the earnings statements with their factors of imprecisión to be able to analyze them and to take advantage of better the information than they provide.

The accounting, according to the principle of countable period, divides the existence of the company in annual days to the aim of which the financial statements appear officially basic.

For administrative effects, we disturb the year in monthly periods and the earnings statement is prepared to evaluate it and to take remedial actions.

Before accepting the game of utility or loss of a month in relation to another one, we must be careful with the following eventualities that can be presented/displayed, among others:



  • Dates of closing. It is very common that in the people in charge of sales they slow down the countable cut looking for to present/display better numbers. In this one case the entrance is had but the costs and fixed expenses of the days are not entered that extend the invoicing, besides of accelerating the payment of the part corresponding to the IVA.

  • In the number of sales returns can be presented/displayed that correspond to periods previous to the month at issue. By all means, the entrance is increased to the low cost and.

  • Discounts by any circumstance, that they do not correspond to the effective sales of the analyzed period; the effect is he himself of the previous numeral.

  • The working days of the month. If beforehand we know that the year presents/displays a certain number of holidays, months have but “relative steady load” without being able to generate income in the nonworkable days.

  • Production available to invoice and not dispatched; of this one form one does not register the operative utility, but the fixed costs and expenses; like obvious consequence, the utility is not registered.




  • Variable costs. They can be seen affected by changes in the prices of insumos that not necessarily appear in the period that is analyzed. Example; a raw material increases in price in January, enters to modify the cost average and it is used in March; the effect also can be negative. Of the same form a change with any other variable component can be presented/displayed.

  • Hidden Costs1. They represent another cause, sometimes the one of greater impact in the results. As its name indicates it, they constitute a true challenge so that the administration reduces them to the maximum. The important thing is to identify them and to quantify them, expressing them like percentage of the sales, indicator that must try to be reduced to its minimum expression.

  • As far as the fixed costs and expenses, the phenomenon is more critical because those nonworkable days of all ways imply the corresponding payments without there are production nor sales. The same it happens with the financial expenses, which appear as it spends the time.

  • The handling of the provisions, estimations calculated with the inherent uncertainty by its character of so, that they can affect positively or negatively the result. For its handling the conservadurismo is recommended.

  • In addition, the units sold in the month not necessarily are the produced ones (or bought) in he himself, and therefore the cost of the produced merchandise is not just like the cost of the sold merchandise.

The previous analysis causes that inconsistencias in the results appear, independently of the quality of the management that is fulfilled, simply by imprecisiones in the handling of the headings of income and debits to register. These considerations allow us to suggest the convenience of the cumulative analysis which will be more representative of the reality in the measurement that advance in the exercise, until arriving at the end of the annual period when the inventories and the provisions conciliate with rigor.

The handling of the numbers of the period (as much years, as months) expressed in terms of working days is recommended, dividing the accumulated total by the number of days thus to calculate the results of the exercise object of the analysis in consistent form and first of all, to avoid all the distortions of information with explanatory notes.

The previous annotations are very useful for the elaboration of budgets and the periodic control oriented to the decision making and remedial action with base in information that come near to the real scenes and fulfill their assignment like tool of value generation and continuous improvement.


1. The hidden costs are from situations of common occurrence by lack TO THINK (Planning, programming, forecast, precaution, prevention) like for example: a. Errors in the assemblies, b.Sudden changes in the order of the process, c. Damages of machine by lack of preventive maintenance, d. Orders badly taken, e. Nonconcordant programmings of production with the office possibility (problems of portfolio, logistic of transport, etc.), f. Use of inadequate materials,g. Bad quality, in the immense majority of the cases, by negligence and lack of concentration, h. Industrial accidents, i. Any other anomalous situation that implies loss of time and affects the production level, j. The deteriorations and decreases of inventory for whatever reason.


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