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What to do if Growth Revenue does not agree with Business Trading Statement

2 May, 2020 by David Seamans

Elements.app promotes sales Growth by historic analysis of the three "Handles. It does this by providing Focus on the clients' traits.

Elements.app draws sales information from a cloud accounting package.  It does not look at any general ledger accounts including:  Income. Expenses, Payroll, Inventory, Cash Flow, Assets, Liabillities or Equity. It enables the business management to make informed decisions on sales and marketing.

Elements.app monitors sales data 24/7.  It generates Notifications on data movement in a way never seen by the business owner before.

Elements.app maintains a record of data from: sales invoices and credit (adjustment) notes.  It retains history of sales targets and strategies unique to it's reporting methods.

That's it. Nothing else!

It is not an application that replaces the financial systems of the business (not yet, at least!!).  Elements.app access no other data in any of the financial systems of the business. It augments those systems.

The sales data is encrypted for maximum security.

Further reading: The Only Four Things Any Business Does

Elements.app: Growth works with:

  • number of active clients, 
  • number of sales transactions and 
  • average sales transaction value.

(All links provided for further reading)

"Revenue" is not captured from the accounting system; it is calculated by Elements.app.

Elements.app generates a Revenue or Income total by:

Revenue = # of "Active Clients" * # of Sales Transactions *Average Sales Transaction Value

The three ways that Elements.app revenue could differ from the Profit & Loss Statement is by:

  1. Invoices or credit notes are used for processes other than ordinary sales.  For example: disposal of fixed assets.
  2. Journals made to the general ledger income accounts.
  3. Pro-forma invoices or credit notes are used.  For example: the building industry recognize the signing of a contract as pro-forma. Progress claims generate invoices.

David Seamans

Co-Founder at Elements, Retired CPA and Company Coach with 35 years of experience building better businesses.