# Profit and Loss Report (https://docs.carlio.app/docs/profit-and-loss/read-the-profit-and-loss-report)

Understand the four headline figures, the margin and the category breakdowns



The report shows four figures, a cash flow chart and two breakdowns for one reporting period.

## Requirements [#requirements]

The permission **Financial Records Access** is required.

## Steps [#steps]

1. Open **[Profit & Loss](https://carlio.app/dashboard/finance)** in the **Finance** group of the sidebar.
2. Read the sentence under the title. It names the period and states that money is counted on the day it moved.
3. Read the four tiles: **Revenue**, **Direct Costs**, **Operating Costs** and **Net Profit**.
4. Read the cash flow chart. See the guide on the cash flow chart.
5. Read **Where Revenue Came From** and **Where It Went** at the bottom of the page.

## The tiles [#the-tiles]

| Tile                | Text under the figure                        |
| ------------------- | -------------------------------------------- |
| **Revenue**         | Everything that came in                      |
| **Direct Costs**    | Buying, landing and preparing stock          |
| **Operating Costs** | Rent, salaries and the rest                  |
| **Net Profit**      | The margin, or a note that no revenue exists |

**Net Profit** is green for zero or more and red for a loss.

## Net margin [#net-margin]

The margin equals **Net Profit** divided by **Revenue**. The tile shows it as a percentage with one decimal, followed by the words of revenue. Example: 18.5% of revenue.

When **Revenue** is zero, the tile shows **No revenue to measure against**. The margin is never shown as zero for a period with no revenue. A loss gives a negative percentage.

## Breakdowns [#breakdowns]

**Where Revenue Came From** lists the Revenue categories that have money in the period. **Where It Went** splits the costs into **Direct Costs** and **Operating Costs**. Each group shows its subtotal.

Each row shows the category, the amount and a percentage. The percentage is the share of the category in the list that contains it. Revenue shares add up within the revenue list. Cost shares add up within each cost group.

The bar of each row is scaled to the largest row of the list. The bar is not scaled to the total.

An empty list shows **No money came in during this period.** or **Nothing was spent in this period.**

## Notes [#notes]

* Gross profit, which equals **Revenue** minus **Direct Costs**, is not shown as a tile.
* A category with money only in the previous period appears with a zero amount.
* Awaiting amounts and invoices are not included. Only ledger entries count.