Management reporting: what it is and what it means

Management reporting is a tool of management control, not management control itself. It compares actual figures with the budget on a monthly basis, producing a snapshot of performance against forecasts. Its operational usefulness depends on two conditions: it must contain only the items that guide decisions for the following period, and it must be quickly readable by those who make the decisions. A report nobody reads produces no decisions. The frequency is within the year — monthly or quarterly — unlike the annual financial statements.

Distinctive: compares actual figures with the budget
Distinctive: tool of management control
Essential: items that guide decisions
Essential: monthly basis
Constant: frequency is within the year

Glossary

Management reporting

A management control tool that periodically compares actual figures with the budget to guide the decisions of the following period.