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How have inflationary trends changed the landscape of Profits & Loss (PnL) for businesses?

After the consecutive crises of the last decade, market conditions have changed. The reflection of the real financial picture of your business and its consistent monitoring determine. On the one hand, its sustainability and upward or downward trajectory, and on the other hand, define its image in the external environment in which it operates.

Systematic analysis of financial statements and the monthly balance sheet or income-expense book of the business, along with drawing crucial conclusions, will allow you not only to avoid repeating past accounting and business mistakes but also to chart a new, healthy, and more realistic strategic path connected to goals, funding, and growth.

We undertake a comprehensive analysis of your business activity, both financially and operationally, highlighting the variables and critical indicators of sustainable and profitable operation. We provide regular advice and support for the continuation.

Inflationary trends can impact the profits and losses (PnL) of businesses in various sectors. Depending on how companies manage these trends, the consequences can vary.

Budgeting (P&L)

The Revenue & Expense Budget of a business is a necessary tool for its sustainability and development, as it serves as the documented plan for its next day. It must include the most realistic estimate possible of the above financial parameters for a specific future period (usually monthly forecasts for the next year) and is drafted and reassessed on a periodic basis.

The correct assumptions for budget determination are of paramount importance for its implementation and achieving the set goals. Its observance facilitates the monitoring of progress and the desired results.

Positive impacts:

Price increase of products/services

If companies can adjust their prices to higher levels due to inflation, their PnL can improve.

Increased value of assets:

Inflation can lead to an increase in the value of assets, such as properties and products. This can have a positive impact on the PnL.

Negative impacts:

Higher production costs

Inflation can lead to an increase in production costs due to higher prices of raw materials and labor.

Reduced consumer purchasing power

Higher prices often lead to a decrease in consumer purchasing power, resulting in reduced sales for many businesses.

Uncertainty in financial markets

Inflation can create uncertainty in financial markets, affecting the value of investments and financial assets.

We support you in creating, monitoring, and ultimately assessing a  realistic Budget that will serve as the compass for your business.

You can send us a message on the Contact Formor you can call at our offices in Athens 2106810690 or in Thessaloniki 2310477725 to set the date of the seminar..

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