Interim management balances (IMB) are essential for evaluating and developing a company's profitability. Whether your company is a SAS or a SARL, these IMBs are strategic.
A definition of intermediate management balances (IMB).
Intermediate management balances (IMB) are relevant accounting and financial tools for companies. They are presented in spreadsheet format.
Establishing KPIs helps improve daily financial management. They are an effective lever for identifying profitability issues.
Spreadsheets showing intermediate management balances are relevant performance indicators (KPIs) for companies. Partners and investors need these balances to develop their operational strategies. They are essential for understanding a company's net profit and identifying potential profitability issues.
The different MIS of a company
Managing a company's key performance indicators requires a keen accounting approach. Companies have eight or nine SIGs, which SeDomicilier suggests you explore:
Each gross operating surplus can be expressed either as an amount or as a percentage of turnover. You might be wondering: How do you manage your accounting yourself? Managing it well means understanding the importance of gross operating surpluses.
Why is it useful to calculate a company's key performance indicators (KPIs)?
The calculation of intermediate balances helps to analyze the profitability of a company's activity. It offers relevant monitoring to ensure the viability of the company's activities over time.
Key Performance Indicators (KPIs): revealing key performance indicators
Using these accounting indicators, company managers can analyze the nature of their net income. A relevant study helps identify the different elements related to production processes.
KPIs highlight exceptional events impacting a company's accounting, such as unusual sales, restructuring costs, etc. The choice of KPIs is closely linked to the company's financial policy and strategy.
Key indicators to develop the company's strategy
The indicators, embodied by the MIS, make it possible to clearly identify the distribution of wealth obtained through the company's commercial activities. The MIS offer opportunities for improvement at different strategic levels for the company:
- Production;
- supply;
- investments;
- financing, etc.
KPIs are a great way to compare a company's profitability against its competitors. They let you measure the financial performance of a business over several years.
The calculation of intermediate management balances (IMBs) varies depending on their nature. It's important to follow a predefined order because some IMBs depend on others to be calculated. SeDomicilier invites you to discover how to calculate IMBs in a specific order.
Once you've calculated the KPIs, you need to be able to understand what they mean.
SeDomicilier explains how to interpret the different intermediate management balances to measure your company's performance.
Production for the year
The production for the year is relevant for companies involved in the production or processing of goods. The amount of this indicator is used to calculate the gross production margin to measure the production activity for the year in question.
If the amount of stored production increases over time, it's important to question the strategy being used. It may be necessary to change the inventory valuation method, or to increase your storage level.
The profit margin
The gross profit margin is a useful tool for managing sales prices. Monitoring it provides a detailed analysis of the company's profits. It's a good idea to compare your company's gross profit margin with those of your competitors. If there's a discrepancy, a thorough analysis is essential.
The gross profit margin MIS requires an in-depth analysis of changes in the purchase prices of goods. Each product line must be calculated according to the gross profit margin to measure its profitability.
Added value (AV)
Added value (AV) must cover dividends and payroll expenses to allow the company to self-finance. A reduced added value risks endangering a company's financing capacity. It's important for it to be high enough to pay employees and shareholders.
Gross operating surplus (EBE)
The gross operating surplus provides the necessary resources for the company to:
- pay your taxes;
- compensate its capital providers;
- finance its activities.
A negative gross operating surplus (EBE) means that there are some issues with your business's operations. There could be several reasons for this:
- the profit margin is too low;
- the payroll is too high compared to the activity forecast;
- sales of services or products do not cover fixed costs.
The operating result (OR)
The operating result (OR) is an indicator to measure a company's ability to generate resources through its activity. When the result is positive, an operating profit is recorded. Conversely, a negative OR indicates an operating loss.
Income before tax
The profit before tax measures the profitability of a company based on its financial strategies. This indicator is based on the operating and financing cycle. It can be positive or negative:
- A current result before tax is positive = current profit.
- A current result before tax is negative = current loss.
Exceptional income
The extraordinary result is not related to the company's current operations. When this indicator is positive, it indicates an extraordinary profit. On the contrary, a negative extraordinary result is symptomatic of an exceptional loss.
A positive extraordinary result can be explained by the sale of real estate or furniture. When this KPI is negative, it implies, for example, the payment of a fine.
Net income
The net result measures the overall performance of a company. It provides information on the wealth generated by its activities.
- A result above 0 euros indicates a net profit.
- A result below 0 euros indicates a deficit.
Intermediate management balances are key performance indicators for companies. Thanks to our intermediate management balance (IMB) tables, you have an overall view of these KPIs, the application and importance of which may vary depending on the activity and structure of your company.
Written by our expert Evan
February 17, 2025
