Why you need to review your finances

Reviewing and analysing your finances will help you to understand your business's performance and potential for growth. It can also help you to run your business more efficiently and make the best business decisions.

What to review

To paint the best picture of your business finances, review and analyse your key financial documents regularly. These may include your business's:

  • Balance sheet – reports your assets and liabilities.
  • Profit and loss statement – shows financial performance and profitability over time.
  • Cash flow statement – the amount of cash generated over a period of time.
  • Budget – compares estimated spending to actual spending.

Have a close look at each of your financial documents for any trends or things that are unusual. Any unusual numbers could indicate areas you need to work on in order to save money or increase sales. Things to look out for may include:

  • declining sales
  • low profit margins
  • greater spending than budgeted for
  • level of debt existing
  • periods of high or low cash flow.


Benchmarking is a useful tool for comparing the performance of your business to others in the same industry.

The Australian Taxation Office’s small business benchmarks can help you compare your financial performance with other businesses similar to yours.

Financial health check tool

The Australian Taxation Office has a free tool to help you check the health of your business finances.

You’ll need to input your financial figures for at least 3 months. The tool then provides you with a report on the health of your business finances, including the main financial ratios and your business viability.

Use the tool

Value your business

Working out how much your business is worth can be an important part of reviewing your business and assessing its viability.

There are a number of ways you can value your business. You can also seek out professional advice to help you.

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