MIS report meaning, Need, Type and Format of MIS report

06/01/2022 0 By indiafreenotes

MIS Reports are reports required by the management to assess the performance of the organization and allow for faster decision-making. A Management Information System, often simply referred to as MIS, can be understood by looking at each of the words that make up the name. There is the management, the information, and the system. At the heart of it, such a system is one that will provide important information to the management of the company.

The complexities of running businesses, have made us more reliant on advanced technologies which will remove any room for errors. On one hand, it accurately states what a management information system does for the management of the company. On the other hand, it cannot be overemphasized that management information systems are very important to the smooth running of a business. It is crucial that businesses opt for an automated management information system is set up for better decision-making.

Need for MIS

MIS reports are crucial for the smooth functioning and growth of your company. Here are a few key points that highlight the importance of an MIS report:

  • MIS reports are used to collect data from various sources. These include employees, management, documents, executives as well as the raw numbers for business sales. All of these are beneficial for identifying and solving problems within your company. They can help in making important decisions.
  • An MIS report also helps to track a company’s financial growth and financial health. It is often used to track, analyze, and report business income.
  • The data collected from the above-mentioned sources is then visualized. This includes presenting the data in the form of bars, graphs, and charts. This provides ease of analysis and helps to gain faster insights from the available data.

The following are some of the justifications for having an MIS system

  • MIS systems facilitate communication within and outside the organization employees within the organization are able to easily access the required information for the day-to-day operations. Facilitates such as Short Message Service (SMS) & Email make it possible to communicate with customers and suppliers from within the MIS system that an organization is using.
  • Decision makers need information to make effective decisions. Management Information Systems (MIS) make this possible.
  • Record keeping: management information systems record all business transactions of an organization and provide a reference point for the transactions.

Types of MIS Reports

Summary Reports

Summary reports are a type of MIS reports used to visualize aggregate data and provide a summary. This summary could be of different business units, different products, different customer demographics among other things. The report is presented in a format that can be understood by the company’s management.

Trend Reports

Trend Reports are types of MIS reports that allow your company to see the trends and patterns among different categories. Trend reports are also used to compare different products or services. They are often used to draw comparisons between the actual versus the predicted output/growth within an organization. These reports help to pinpoint the problem areas in a company and give potential solutions to them.

On-Demand Reports

The on-demand report is a type of MIS reports that are produced on specific demands from your company’s management team. There is no fixed criteria or format that must be included in an on-demand report. This type of MIS report includes the requirements of a company and the prevailing circumstances will dictate the contents of an on-demand report.

Exception Reports

An exception report is a type of MIS reports that is an aggregate report of exceptions, which are abnormal or unusual circumstances within a company. The exceptions report will collect instances of all such conditions within different departments in your company, and present them to the management in a uniform format. Exceptions reports are useful for catching problems early, and solving them before they cause a major disruption.

Financial Reports

Financial reports are types of MIS reports that can be used to determine the financial condition of an organization. A financial report often includes a company’s balance sheets, income, and expense details, and cash flow statements. Financial reports are used by your company’s financial analysts, investors, the board of directors, and even government units to access the overall financial health of your organization. These reports are used in making critical financial decisions within a company.

Inventory Reports

Inventory reports are a type of MIS report that is used to manage and keep a track of all the products in your inventory. The inventory report includes details about the number of products left in stock, the best selling products, the top-selling categories of products and how they vary by demographic, etc. Inventory reports can help your business to make smarter, data-driven decisions.

Budget Reports

Organizations operate on a variety of budgets. These may include cash budgets, income v/s expenditure budgets, marketing budget, HR budget, production budget, etc. An MIS budget report contains internal information about your organization. It is used to maintain your company’s financial health while driving growth.

Sales Reports

The sales report is prepared by the marketing and sales division of your organization. It includes a visualization of products that have been sold during the last quarter/month in your organization. The sales data is often visualized by taking into account the budgeted and actual sales numbers. It provides an insight into the sales variance (the difference between the budgeted and actual sales), the geographical distribution of products sold, and the timeline of sales among other factors.

Cash Flow Statements

Cash flow statements are a Types of MIS report that underlines the exact amount of cash inflow versus the cash outflow in your organization. The cash flow statements include the cash flows from your company’s operations (the core business), investments (capital investments), and financing (external investors). These are together referred to as your company’s ‘net cash flow‘. Cash flow statements are very important to maintain a profitable business.

Production Reports

Production report is a types of MIS report that contains information about the raw production numbers in your company. The manufacturing division within your company will prepare this report, and provide details of the production targets that were achieved or missed. This report also details the predicted v/s actual products manufactured in the time frame. It may also highlight a production bottleneck or ideas on how to speed up the production process.

Funds Flow Statement

Your company’s accounts and finance department is responsible for the preparation of funds flow statement. These statements give insights into the various sources of funding within your company, and how that funding is being utilized. Fund flow reports usually analyze your company’s balance sheet from the past two years, and understand the flow of funds from the previous year to the current financial year.