With increasing complexity in business and technological advances, evaluating organisational performance is crucial. Managements now rely on extensive reporting of every aspect of their business to help with efficient management. Such reports provide deep insights for making smart business decisions and strategies. MIS report full form can be stated as Management Information System, which is integrated with accounting software. It provides a wide range of reports from trends, inventories, cash flows, and more to opt for automation in management information systems so companies can run more efficiently and productively.
Objectives of MIS:
MIS or Management Information Systems are used by business management to monitor and assess an enterprise’s health, present position, financial status etc., to enable smart business decisions at every step of growing their businesses.
Why use MIS?
MIS full form is a Management Information System and can help with the following:
- MIS reporting generates several types of reports that enable organisations to make effective decisions. MIS reporting is crucial for ensuring the positive growth of a business.
- MIS reports help in record-keeping and eliminating manual entries, therefore eliminating significant errors. It helps save time and acts as a reference point for managing loads of information.
- MIS report developed from MIS system aids in proper communication across departments and teams with only a few clicks. Any employee can now access various parameters of a business while staying connected to others. It also provides email, SMS, and reminders to improve customer and supplier experiences, which positively impacts a business.
What does an MIS system consider its building blocks? Let's take a look at the significant components of an MIS or management information system.
- People/Employees/Customers who use the MIS.
- Business Processes that help in storing, recording, analysing the report and various data inputs.
- Large volumes of data across the business which is generated by the second and input into the system.
- Software programs, including accounting software, are integrated to allow the MIS to handle large volumes of data from different sources and in different forms like Excel sheets, spreadsheets, software programs, databases and more.
- The hardware of the MIS includes its printers, servers, networking equipment, workstations etc.
The diagram below can help explain how the various parts of an MIS structure are built to support strategic, tactical and operational management at all levels and how complex the decision-making structure gets in a business’ daily progress to growth.
The various types of management information systems required by a company depend on communication between the various levels of decision making. It also depends on the people who handle data and generate the MIS report of a company along with customers. Efficient data management and timely reporting are also important factors of management information systems. Through this, an integrative use of MIS is done, which helps develop the products, technology, inter-relationships, etc., creating a unique experience for each business.
Also Read: Rules and Examples of Trail Balance
Tally.ERP 9 and MIS report types:
What is an MIS report? Several types of reports generated in Tally ERP 9 can be summed up under various category heads. MIS solutions like TallyPrime also use the enterprise’s data to make informed and smart business decisions.
They are MIS in accounting reports like:
- Financial reports: These reports track and report the business’ creditors, shareholders information, compliance, financial statement reports and risk reports of governmental requirements.
- Accounting reports: A business’ financial status, accounting statements, financial health, economic activity, operational parameters etc., are tracked in this report.
- Management control reports: Through these reports, evaluation of budget utilisation, financial health status parameters, cost control reports and more to enable better control over the various activities of the business.
- Inventory reports: These reports track and report the various inventories of products across the business, like processed products at different stages in the workflow, ready stocks, raw materials, fixed and movable assets etc.
What is MIS reporting?
MIS report meaning pertains to all aspects of management enabling informational reports including financial statements of your company. An MIS uses technology, data, people, and business processes to effectively interlink them and make smart business decisions and efficient strategies, making it possible at every step of daily business activity.
MIS Preparation requires tracking, analysing and reporting the day-to-day business activities. This enables progress to be monitored across the organisation and provides crucial error-free reporting to enable critical insights and reference points in the monitoring, communication and business processes. Such reports depend on the latest technological advances and are essential to every business that intends to stay healthy and grow by the day.
Types of MIS reports
There are different types of MIS reports developed from data across the various departments of any organisation, such as:
- MIS Report Summary: A summation of MIS reports enable you to aggregate and summarise large volumes of data about a particular reference point drawing from relevant information. For instance, the summary report would include customer segmentation and demographics reports, market trends, and supply inventories in a product launch. It would also include information of different business units production and MIS reports, sales and competitors information reports, etc., for the company’s management to make effective decisions.
- MIS Trend report: MIS reports that correlate the patterns, trends, different categories, price differentials etc., are used to compare and analyse the various services and products across an organisation. They compare the predicted trend with the actual parameters of the organisation to make better decisions and solutions while explaining the differences to reference points in the company's growth. Thus, trend reports are problem finders and pinpoint growth areas too. For example, the sales trend reports would explain actual performance versus predicted performance and help understand shortcomings in production, customer trends, sales etc.
- Exception MIS reporting meaning: It shows the exceptional circumstances faced by a company and the rectifications required for managing these unusual circumstances. These exception reports help resolve the problems early on so that there is no issue in the future, leading to more significant issues. For example, a poorly stocked inventory in a company may occur because of natural disasters, transportation issue or other causes leading to a delay. This leads to a lack of supply of a particular product or raw material in a particular department, leading to the delay of the business process. Therefore, by having an Exception report, the management can stock the inventories better, make financial adjustments, explain the underperformance of the sales etc.
- Inventory Reports: These are MIS reports that track the several inventories of a company, including sales inventories, product inventories, work-in-progress inventories etc. These inventory reports drive financial, operational and sales smart decisions. For example, if your inventory report suggests an unsold product at one location, the MIS reports can drive a decision to sell it at another location.
- On-Demand Reports: Such MIS reports are specifically demanded and produced for the management team. The reports have no particular format or fixed reporting criteria and depend on the nature of why this report is required. For example, the Sales Manager may demand an on-demand report to predict the location’s peak season for a particular company product. Such a report helps decide whether to introduce a second well-priced product in the same location or to improve sales of both products.
- Sales Reports: MIS Sales reports are prepared by the sales and marketing departments of a company and include information on the sales, products etc., sold in a particular week, month, quarter etc. The sales variance is determined and explained in this report and impacts the income, financials, sales decisions, stocking inventories etc. For example, a shortage of stock can be determined in a peak season at a particular location enabling better anticipation of peak sales.
- Financial Reports: These are MIS reports used to draw up the financial status and health of an organisation and generally include the cash flow statements, expenses statement, income statement, balance sheet, Profit and Loss (P&L) Statement, and more. Such reports are essential to the management’s financial decisions, shareholders seeking to reinvest or be paid dividends, etc. For example, your company might use weekly finance numbers in a quarterly, annual or even weekly financial report for evaluating company performance.
- Funds Flow Statement: This is the company’s financial accounts statement of its current liabilities and assets, providing the management and finance department with an MIS report with two Balance Sheets. These enable proper decision making regarding funds utilisation, sourcing, etc. The MIS report will also have the P&L Statement and the current and previous year’s Balance sheets included in the reference points. For example, the increased sales, production etc., can be found in the assets side of the fund flow statement.
- The Actual Vs Budgeted Profit Report: These MIS reports highlights the actual differences in these two values for a specific period and is prepared by the accounts department. The MIS report serves to analyse, report and communicate this report to the management with a possible insight explaining the differences in values when looking for viable solutions to enhance the company's profits. For example, the underperformance of a sales' location could explain that poor delivery is the cause of differences in the projected and actual profits from sales.
How MIS Reports Work:
- MIS reports of various kinds are periodically made and could be monthly, weekly, quarterly, or half-yearly as the case may demand.
- They comprise the various department's reports presented to the management team of the company. The management uses these MIS reports and insights to help make better decisions and innovative business strategies to improve the various areas that need rectification which is thrown up in the insights.
- The MIS reports accumulate large volumes of daily raw data, patterns, reference points and previous comparisons, trends, competition data and more to churn out gainful insights into the working of the business activities.
Thus, companies can take timely decisions, compete smarter, work more efficiently, stay healthy financially and more with valuable insights from MIS Reports. The MIS system is also very efficient in bringing communication across a company to the table to make strategizing and performance better at all levels preemptively.
For example, when a company needs to launch its new product, the MIS reports are essential to ensure that the timing, pricing, segment targeted, etc., are just right. Staying updated regarding the latest market trends, competition information, reference and data points are also crucial to this process. Thus, an MIS report enables a company’s efficient performance through both long-term and short-term decision making.
In this article, we have seen an MIS report means and see how the MIS reports help the growth and health of a company and are essential to the management, teams across the organisation, investors, and a company's health indices. Through such reports, the management of the company is able to make adequate decisions regarding its functioning. Its impact on faster decision-making is one of the key advantages derived from MIS reports.
You can manage and handle such reports with Biz Analyst which is helpful for Tally users. With this application, you can stay connected with your business, create data entries, send payment reminders and view reports, analyse sales and make data-driven decisions. Moreover, your data remains safe and secured making your business accounting process stress-free.