How financial analysts can benefit from Embedded Balance Sheet dashboard
Introduction
A company’s financial metrics show its stability and performance, so the role of the finance department is vital. How a company’s money flow is registered and managed determines its growth and credibility. Balance sheets are used to register all monetary activities of a company. They show analysts the spending and revenue trends over time.
Embedded analytics helps you to extract financial insights from a company’s historical data, letting you make better-informed decisions about the company’s future. Finance leaders can use embedded analytics to collect data from internal and external sources, perform analysis, and track key performance indicators (KPIs) in your own business applications. In this blog post, I am going to give you an overview of how embedded analytics helps financial analysts to achieve their business goals using the following topics:
- What is embedded analytics?
- Benefits of embedded balance sheet dashboard
- Bold BI’s Balance Sheet dashboard example
- How to embed Bold BI’s balance sheet dashboard into your application
What is embedded analytics?
Integrating analytical solutions and data visualization capabilities in any software application’s user interface to improve data comprehension and usability is known as embedded analytics. Bold BI helps you easily embed an analytics solution into your everyday work applications using a JavaScript SDK and server application. This helps you to reduce your dependency on IT teams and glean all the insights you need to improve administrative and workforce outcomes.
Benefits of embedded balance sheets for finance departments
A balance sheet is a key accounting instrument for a company’s financial management that gives an overview to administrators of how well their organization is performing and what areas they need to improve. It shows the gradual growth of a company by incorporating every record since its beginning. It can help evaluate the company’s assets, liabilities, and equity.
A proper balance sheet enables financial analysts to monitor their key metrics and KPIs and helps them answer the following questions:
- Does the business have a positive net worth?
- Does the company have the ability to meet its obligations with cash and short-term assets?
- Is the company more heavily indebted than its competitors?
Embedded analytics helps improve financial health of your company through:
- Effective risk management
- Efficient revenue and balance sheet management
- Better workforce and inventory management
- Managing cashflow and operational efficiency
Effective risk management
Closely monitoring your company’s balance sheet provides you insights into its financial health. It helps you identify the risks and mitigate them with proper decisions.
Embedded analytics reduces time spent flipping among a company’s financial software and other applications simultaneously, correlating information manually. Managers can track financial performance in their own business application, tracking key metrics such as current ratio, quick ratio, cash balance, and liquidity ratio. By monitoring a comprehensive view of the organization’s credit and market risk, they can devise strategies that help them to weather the market’s slowdowns in the long term.
Efficient revenue and balance sheet management
Managing financial account data and analyzing it can be a tedious process for many accounting teams. Deploying embedded analytics in your software application helps you analyze contextual data such as the debt-to-asset ratio, debt-to-equity ratio, and working capital. It can provide visual analytics within operations, financial, and accounting systems. Managers now have access to detailed variance reporting as well as the capacity to deconstruct and analyze the data that underlies the balance sheet. The insights gained from those metrics assist the key decision-makers in compiling risk assessments as investment opportunities arise.
Better workforce and inventory management
Embedded analytics in your work environment collects all day-to-day data such as shipment departure time, shipment arrival time, and employee workflow management into one place. You can track other metrics such as the inventory-to-sales ratio, inventory turnover, days sales in inventory, and days inventory outstanding, which can help shed light on the company’s inventory management. Using these insights, the managers can study the market trends, restock the bestselling products, and set competitive prices that help the company grow.
Managing cashflow and operational efficiency
Embedding analytics enables managers to use the predictive analytics feature to forecast future AR and AP, cash balance, and the cash-to-cash cycle, which help you monitor cash flow. You can also analyze the company’s financial ability to pay back its liabilities and gain insights into the company’s operational efficiency, liquidity, profitability, and solvency. Monitoring these metrics helps managers to improve the growth of the company in the upcoming quarters and strategize their moves according to market fluctuations.
Bold BI’s Balance Sheet dashboard
Bold BI’s Balance Sheet dashboard shows the financial state of a company’s accounts through the key financial metrics provided. It can track the financial performance for a particular period of the year.
With this dashboard, you can learn about these metrics and KPIs that enhance your company’s balance sheet:
- Working capital
- Current ratio
- Liquidity ratio
- Quick ratio
- Debt-to-asset ratio (DAR)
- Debt-to-equity ratio (DER)
- Inventory to sales
- Inventory turnover
- Days sales in inventory (DSI)
- Cash balance
- Days sales outstanding (DSO)
- Days inventory outstanding (DIO)
- Days payable outstanding (DPO)
- Cash-to-cash cycle (CCC)
- AR turnover vs. AP turnover
- Overall financial statement
Working capital
Working capital is the amount of assets available to a company minus its liabilities.
Formula:
Working capital = Current Assets — Current Liabilities
Current ratio
Comparison between the company’s current assets and current liabilities is known as the current ratio. It can be calculated by dividing the current assets by current liabilities.
Formula:
Current Ratio = Current Assets/Current Liabilities
Liquidity ratio
A liquidity ratio is a financial measure used to assess a company’s ability to meet its short-term loan obligations. The metric is used to determine if a company’s current assets, or liquid assets, can cover its current liabilities.
Formula:
Current Liabilities/Current Assets
Quick ratio
The calculation of a company’s liquid assets versus its current liabilities is known as the quick ratio. The greater the quick ratio, the better the company’s position.
Formula:
Quick Ratio = (Current Assets — Inventory)/Current Liabilities
Debt-to-asset ratio (DAR)
The debt-to-asset ratio, also known as the debt ratio, is a leverage ratio that shows how much of an asset’s value is financed with debt. The larger the ratio, the more leverage and financial risk there is.
Formula:
Debt-to-Asset Ratio = Total Debt/Total Assets
Debt-to-equity ratio (DER)
The debt-to-equity ratio calculates the value of total liabilities to total equity.
Formula:
Total Liabilities/Shareholders’ Equity
Inventory to sales
The inventory to sales number measures the amount of inventory you possess against the number of sales you’re fulfilling.
Formula:
Average Inventory/Net Sales
Inventory turnover
Inventory turnover shows the cost of goods sold against the average inventory within the same time period.
Formula:
Inventory Turnover = COGS/Average of Inventory
Days sales in inventory (DSI)
The average time taken by a company to turn their inventory into sales is known as days sales in inventory.
Formula:
Days Sales in Inventory = Inventory/COGS x 365
Cash balance
Cash balance shows the difference in the value of total assets and current assets.
Days sales outstanding (DSO)
Days sales outstanding shows the number of days a company takes to collect its accounts receivables.
Formula:
(Receivables/Revenue) x 365
Days inventory outstanding (DIO)
Days inventory outstanding (or days sales of inventory) indicates the average number of days a company can keep its inventory before selling.
Formula:
(Inventory/COGS) x 365
Days payable outstanding (DPO)
Days payable outstanding is an efficiency ratio that shows how many days a company takes to pay its suppliers.
Formula:
(Accounts Payable/COGS) x 365
Cash-to-cash cycle (CCC)
The cash-to-cash cycle shows the amount of time it takes a company to convert its investments in inventory to cash.
Formula:
CCC = DIO+DSO-DPO
AR Turnover vs. AP turnover
This column chart shows the difference between AR turnover and AP turnover where AR turnover shows the ratio of total purchases to average accounts receivable and AP turnover shows the ratio of total supplier purchases to average accounts payable.
Overall financial statement
This grid shows the financial statement of assets, liabilities, equity, etc. of a company over a period of time.
To learn more about the metrics and KPIs used in this dashboard example, refer to the Balance Sheet Dashboard demo.
How to embed analytics tools into financial apps
Let’s see how analytics can be embedded into your finance web applications. Bold BI helps you embed your dashboards in more than 10 web platforms, including ASP.NET Core, ASP.NET MVC, Angular, ASP.NET, and Ruby on Rails. In this blog, I am going to explain how to embed dashboards in your ASP.NET MVC applications. Consider a scenario in which your finance department has a website like the one shown in the following image.
You can embed dashboards easily using Bold BI Embedded and avoid building an analytics or BI solution yourself. Follow these steps to embed your dashboard successfully.
Prerequisites
Download and install the Bold BI server on your local machine and create an enterprise-grade dashboard. You can find the installation and deployment instructions here.
Step 1: Creating an ASP.NET MVC application.
To successfully embed a dashboard in your application, first you need to create an ASP.NET MVC application. Open Microsoft Visual Studio and click New Project. Then choose ASP.NET MVC Web Application, enter the project name, and click OK.
Step 2: Configure embed properties.
After the ASP.NET MVC web application is created, you need to create a Model class called EmbedProperties under Models and provide the dashboard RootURL, SiteIdentifier, Environment, UserEmail, and EmbedSecret.
Dashboard server BI URL. For example: http://localhost:5000/bi, http://dashboard.syncfusion.com/bi.
RootUrl: Dashboard server BI URL. For example: http://localhost:5000/bi, http://dashboard.syncfusion.com/bi.SiteIdentifier : For Bold BI Enterprise edition, it should be something like “site/site1”.For Bold BI Cloud edition, it should be an empty string.Environment : Bold BI application environment.For cloud BI, you can use “cloud”.For enterprise BI, you should use “enterprise”.UserEmail : Bold BI server will use an email to authorize the authorization server.
Step 3: Generate embed secret.
You have to set the EmbedSecret for authentication. You can get the embed secret from the Bold BI server. Then, navigate to the Settings icon in the left navigation bar and click the Embed tab. Click Enable embed authentication and then click the Generate Secret button to generate the embed secret. On clicking the button, a secret key will be generated, and you can paste it into the application. To learn how to do this in more detail, you can refer to this documentation link.
Note: Save the secret key, as it cannot be retrieved again. If you do not save it, you will have to generate a new one using the Reset Secret option.
Step 4: Create authorization server.
You need to implement an authorization server in the ASP.NET MVC application to get authenticated before embedding the dashboard from the Bold BI server. You can also configure the single sign-on (SSO)-based authorization server, which is an authentication endpoint that enables users to securely authenticate multiple applications using unique embed secrets. This prevents the need for the user to log into different applications separately.
Step 5: Create Bold BI instance.
Finally, create a Bold BI instance to load the dashboard using a JavaScript file. Reference required script files and CSS files in the HTML pages.
Step 6: Run the application to embed the dashboard.
After successfully creating the ASP.NET MVC application, you need to run it. It will be launched successfully with the dashboard details. Finally, you can that see the dashboard created in the Bold BI server is embedded in your web application.
By following the previous steps, you can successfully embed your dashboards into your ASP.MVC application.
To learn more about embedding dashboards into your applications, please refer to this blog. You can also download the sample codes mentioned in all these steps from our documentation.
Conclusion
Bold BI Embedded helps you to integrate dashboards in your applications written in React with ASP.NET Core, React with Go, WinForms, Node.js, Vue with Go, Vue with Core, and more, seamlessly. It will help you save time and prevent you from doing redundant work. Click this link to explore its features. To learn more about embedding dashboards into your application, refer to this blog and our help documentation.
I hope you now have a better understanding of Bold BI Embedded and how it will help the finance domain to be more successful. You can create a dashboard as you like with Bold BI Embedded’s 35 widgets and 130 data sources.
To get started with Bold BI, schedule a free 30-minute demo with our experts about creating dashboards and any other features you would like to learn more about. You can contact us by submitting questions through the Bold BI website or, if you already have an account, you can log in to submit your support question.
Originally published at https://www.boldbi.com on October 21, 2021.
