Why does Report X Not match my P&L Report???

I would like to take some time to explain to everyone why the P&L and Sales Tax reports that you think should balance – won’t balance.

I would like to use real world figures, and present evidence for you, why 3 reports match to the penny when comparing apples to apples to apples – but won’t ever visually appear to match because you are matching apples to oranges to grapes – and this is simply due to user interaction with Lizzy during the normal course of business.

I say three reports because it has always been our contention that the Sales Summary Report and the Sales Tax Report should match, and that if they don’t, 99% of the time its because something didn’t get processed on the Tax Report for a prior month, and so that you will understand that these reports do, in essence, match to the penny, when the users don’t interfere.

Lets start with the Sales Summary report.

If you run the Sales Summary report, you get a Grand Total of 562123.64.  Now we will subtract out our Tax Figures ( 3194.50, 1806.28, 17890.47, 162.28, 266.55 ) which will leave us with 538803.56.  There is our test figure.

Now, lets run the Sales Tax Report.  Our bottom line ( Invoice Totals through the end of the period ) is 550300.73.  Now at first glance – this doesn’t match our test figure.  Here is why this is an orange instead of an apple.  If you scroll back up to the top of the report, your Other State tax BLAH has never been processed.  So every invoice in there, except for one, is from a prior period.  If you look at the detail, the last invoice, # 1111, is from last month.  Every other invoice is from the months before that.  Since those are our oranges – lets take them out.  11567.66 ( total of BLAH ) – 70.49 ( our 1 valid invoice for last month ) = 11497.17.  Now, if we subtract that from our 550300.73 we get 538803.56.  We match our Test figure to the penny.  Now – if the BLAH tax isn’t due monthly, then you should be using our other report structure ( which allows you to report only specific taxes, and lists everything else as out of state ) – but we can cover that later…

So now, 2 of our 3 reports match to the penny – so lets look at the P&L.  If we generate a P&L for last month, our Total Income is 512434.36.  Now of course, this doesn’t match our test figure.  Again my argument is that it never will this way, because you, as the user, do things that hit these accounts that aren’t on an invoice, and thus, change this figure from being an apple to a grape.  But what happens if we remove the grapes…  So lets do that, and prove how it does match before the you, the user, does something in the system that you don’t think to take account for.

So we start with 512434.36.  First, account 451.00.000 are overs/shortages that deal with the cash drawer – and thus don’t appear on invoices – so we need to remove that from our GL Total.  Also, after further review, 442.10.040 – Arbitration Fee doesn’t come from an invoice – this came from a AR adjustment ( if we go to the General Ledger > Locate, and look at the account for last month – we’ll see that hit ).  So that doesn’t appear on an invoice, so we’ll need to remove this 89.41.  If we look at 422.99.999 – we see that this is not an invoice transaction – its a Misc Cash entry ( meaning someone used it to adjust the cash drawer ).  So that 700 doesn’t belong in our GL Total.  So lets remove those.  512434.36 – 121.32 – 89.41 – 700 = 511523.63.  So now we need to look at the things that reduced our P&L or weren’t on our P&L.  First, we have 5 POs that were posted against our sales accounts ( 1111-00 thru 1115-00 ) for a total of 22287.00.  So our GL Total is short that amount – so lets add that back in.  511523.63 + 22287 = 533810.63.  Now, there are things on an invoice that don’t hit the sales account – especially on unit sales.  Those are License & Registration Fees, Tire Disposal Fee, and a big # – Trade Payoffs ( which become POs to be paid ).  If we review those figures, we get 25, 1245.50, and 3722.43.  Now these are amounts that affect the invoice total ( and in the case of trade payoffs, the tax as well ) but DO NOT APPEAR ON THE P&L because they are liabilities.  But lets add those into our figure.  533810.63 + 25 + 1245.50 + 3722.43 = 538803.56.

So by taking away all the non-invoice user interaction with the tax report and the GL, we see that everything balances.  But so long as you do things like have shortages/overages in your cash drawer, write AR adjustments to sales, write Cash Drawer adjustments to sales, sell license and registration fees, have to deal with Tire disposal fees, and take trade ins with a balance owed, your P&L will never match your tax report.  Now, since all of those things are a normal part of doing business, you’ll understand why your P&L will never, just by looking at the total income, match your tax report.  And if you continue to not pay off everything on your tax report monthly, why your tax report will not match your sales summary report.

My point is that, as you can see, the system is DEAD RIGHT when it comes to its figures.  ( As has been proven to many of you dealers who asked me to prove it ).  So the issue isn’t the reports – as I’ve shown they all match once you take user issues into account.  I hope this evidence proves to you that you can trust the Sales Tax Report, and the Sales Summary, and the P&L Reports – even though they don’t match at first glance.

Another report people ask us about is the Technician’s Performance Report.  Why doesn’t it match my Labor Sales on my P&L? Remember, the P&L only reports figures that have hit the GL and an invoice does NOT hit the GL until you cash it out.  So a Technician’s Performance Report can show you things that you haven’t cashiered out yet, thus not hitting the GL.

So, you need to keep in mind these factors when trying to compare multiple reports in Lizzy. Remember, you are not always comparing apples to apples – in these two examples above, we were comparing applies to some other type of fruit!.