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Getting Started with LedgerIQ

LedgerIQ transforms raw accounting data into comprehensive financial intelligence in seconds. This guide covers everything from data import to generating professional client reports.

1

Importing Your Data

LedgerIQ accepts standard accounting exports from any platform. All processing happens client-side in your browser for maximum privacy.

Supported File Formats:

  • CSV (Comma-Separated Values) - most common
  • Excel (.xlsx, .xls)
  • TSV (Tab-Separated Values)
  • Direct upload from ReconcileIQ/CodeIQ sessions

Required Data Structure:

Column Required? Description
Account Code Yes Nominal code (e.g., 1000, 4000, 7100)
Account Name Yes Descriptive name (e.g., "Bank Current Account", "Sales - Products")
Balance / Debit / Credit Yes Current account balance or separate debit/credit columns
Date / Period Optional For trend analysis (multiple periods required for forecasting)

Data Privacy:

LedgerIQ processes all data client-side in your browser. No financial data is sent to our servers. Your data never leaves your device unless you explicitly export a report.

2

AI Account Classification

Once imported, LedgerIQ's Universal Enrichment Intelligence automatically classifies accounts into financial statement categories.

Classification Categories:

  • Assets: Current Assets, Fixed Assets, Inventory, Accounts Receivable
  • Liabilities: Current Liabilities, Long-term Liabilities, Accounts Payable
  • Equity: Share Capital, Retained Earnings, Drawings
  • Income: Sales, Other Income, Interest Income
  • Expenses: Cost of Sales, Operating Expenses, Administrative, Financial

How Classification Works:

  1. LedgerIQ analyzes account codes (e.g., 1xxx = Assets in UK charts)
  2. Semantic analysis of account names using machine learning
  3. Pattern matching against thousands of known Chart of Accounts structures
  4. Manual review and correction available in "Classify" tab

Accuracy Tip:

For best results, ensure your Chart of Accounts follows standard UK GAAP or FRS 102 structure. LedgerIQ achieves 95%+ accuracy on standard CoAs without manual correction.

3

Select Analysis Modules

After classification, choose which analysis modules to run. You can select individual modules or use "Quick Analysis" to run all standard modules at once.

Recommended Workflow:

  1. Start with Core Statements: Balance Sheet, P&L, Cash Flow for foundation
  2. Add Ratio Analysis: Liquidity, Profitability, Efficiency for performance metrics
  3. Run Trend Analysis: If you have multi-period data (3+ months recommended)
  4. Add Advanced Modules: DuPont, Break-Even, Working Capital based on client needs
  5. Forecasting: Revenue & Cash Flow forecasting (requires 6+ months historical data)

Performance Note:

Analysis is instant for charts with up to 500 accounts. Larger datasets may take 5-10 seconds for complete analysis suite.

4

Navigating the Dashboard

LedgerIQ's dashboard organizes analysis modules into logical categories with visual cards and interactive charts.

Left Panel: Module Selector

  • • Categorized by analysis type
  • • Click any module to view results
  • • Badges show "Ready" or "Needs Data"
  • • Search bar for quick module access

Right Panel: Results View

  • • Interactive charts (zoom, download as PNG)
  • • Tabular data with export to Excel
  • • AI-generated insights and commentary
  • • Period comparison controls

30+ Analysis Modules Explained

LedgerIQ provides a comprehensive suite of analysis tools covering every aspect of financial performance.

Core Financial Statements

Foundation of all financial analysis - these modules reconstruct professional financial statements from your trial balance.

Balance Sheet Analysis

Generates classified balance sheet with Assets, Liabilities, and Equity sections. Includes vertical analysis (% of total assets) and horizontal analysis (period-over-period changes).

Use Case: Assess financial position, asset composition, leverage, net worth

Profit & Loss Statement

Income statement with gross profit, operating profit, and net profit calculations. Automatic COGS identification and expense categorization.

Use Case: Profitability assessment, expense control, margin analysis

Cash Flow Statement

Indirect method cash flow with three sections: Operating Activities, Investing Activities, Financing Activities. Reconciles net profit to cash generated.

Use Case: Liquidity planning, working capital management, investment analysis

Common-Size Statements

Expresses each line item as a percentage of base figure (revenue for P&L, total assets for balance sheet). Enables comparison across companies of different sizes.

Use Case: Benchmarking, identifying structural changes in financial position

Liquidity Ratios

Measure ability to meet short-term obligations and overall financial flexibility.

Current Ratio

Current Assets ÷ Current Liabilities

Measures ability to pay short-term debts. Healthy range: 1.5-3.0

Quick Ratio (Acid Test)

(Current Assets - Inventory) ÷ Current Liabilities

Conservative liquidity test excluding inventory. Healthy range: 1.0-2.0

Working Capital

Current Assets - Current Liabilities

Absolute measure of liquidity cushion. Positive is healthy.

Cash Ratio

Cash ÷ Current Liabilities

Most conservative liquidity measure. Healthy range: 0.5-1.0

Profitability Ratios

Assess ability to generate profit relative to revenue, assets, and equity.

Gross Profit Margin

(Revenue - COGS) ÷ Revenue × 100

Measures production efficiency. Varies by industry (retail: 20-40%, services: 50-80%)

Net Profit Margin

Net Profit ÷ Revenue × 100

Overall profitability after all expenses. Healthy range: 5-20% (varies by industry)

Return on Assets (ROA)

Net Profit ÷ Total Assets × 100

Efficiency of asset utilization. Higher is better (typical: 5-15%)

Return on Equity (ROE)

Net Profit ÷ Equity × 100

Return generated for shareholders. Healthy range: 15-25%

Efficiency Ratios

Measure how effectively assets are used to generate revenue.

Asset Turnover Ratio

Revenue ÷ Total Assets

How many £ of revenue generated per £ of assets. Retail: 2-3x, Services: 1-2x

Inventory Turnover

COGS ÷ Average Inventory

How many times inventory is sold and replaced per year. Higher is better (typical: 4-8x)

Debtor Days (DSO)

(Accounts Receivable ÷ Revenue) × 365

Average days to collect payment. Lower is better (typical: 30-60 days)

Creditor Days (DPO)

(Accounts Payable ÷ COGS) × 365

Average days to pay suppliers. Balance between cash flow and supplier relationships

Leverage Ratios

Assess financial risk and debt capacity.

Debt-to-Equity Ratio

Total Liabilities ÷ Total Equity

Measure of financial leverage. Healthy range: 0.5-2.0 (lower is less risky)

Debt-to-Assets Ratio

Total Liabilities ÷ Total Assets

Percentage of assets financed by debt. Healthy range: 30-60%

Interest Coverage

EBIT ÷ Interest Expense

Ability to pay interest. Healthy: >2.5 (higher is safer)

Equity Ratio

Total Equity ÷ Total Assets

Ownership stake in assets. Healthy range: 40-70%

Risk Assessment:

LedgerIQ color-codes ratios: Green (healthy), Amber (caution), Red (risk). Thresholds are industry-standard but can be customized for specific sectors.

Advanced Analysis Modules

DuPont Analysis

Decomposes ROE into three components: Net Margin × Asset Turnover × Equity Multiplier

Use Case: Identify whether ROE is driven by profitability, efficiency, or leverage

Break-Even Analysis

Calculates break-even point in revenue and units. Requires fixed/variable cost classification.

Use Case: Pricing strategy, cost structure optimization, safety margin calculation

Working Capital Management

Cash conversion cycle analysis: DIO + DSO - DPO. Identifies cash flow bottlenecks.

Use Case: Optimize working capital requirements, improve cash flow

Trend Analysis

Time-series charts for all KPIs with regression analysis and seasonality detection. Requires 3+ periods.

Use Case: Identify long-term trends, spot anomalies, measure progress toward goals

Revenue & Cash Flow Forecasting

LedgerIQ's forecasting engine uses statistical models and AI to project future financial performance based on historical patterns.

How Forecasting Works

LedgerIQ analyzes historical data to identify patterns, seasonality, and trends, then projects these patterns forward.

1

Data Requirements

Minimum: 6 months historical data. Recommended: 12-24 months for accurate seasonality detection. Data must include period/date column.

2

Trend Calculation

Linear regression identifies underlying growth rate. Example: 5% month-over-month revenue growth becomes baseline forecast.

3

Seasonality Detection

AI identifies recurring patterns (e.g., December spike in retail, summer dip in B2B). Seasonality factors applied to baseline forecast.

4

Confidence Intervals

Forecast includes upper/lower bounds (typically ±10-20% from baseline). Wider intervals for volatile businesses, narrower for stable.

5

Projection Period

Default: 6 months forward. Customizable up to 12 months. Accuracy decreases beyond 6 months for most businesses.

Forecast Accuracy:

For stable businesses with 12+ months of history, LedgerIQ forecasts typically achieve ±15% accuracy for 3-month horizon. Accuracy varies by industry volatility and data quality.

Scenario Planning & What-If Analysis

Test different assumptions to understand potential outcomes and prepare contingency plans.

Scenario Types:

Revenue Scenarios

"What if revenue grows 10% faster?" or "What if we lose our top client (20% revenue drop)?"

Cost Scenarios

"What if raw material costs increase 5%?" or "What if we reduce headcount by 2 FTEs?"

Investment Scenarios

"What if we invest £50k in new equipment?" - see impact on depreciation, cash flow, and ROI

Financing Scenarios

"What if we take on £100k debt at 6% interest?" - see impact on leverage ratios and interest coverage

Example: Revenue Growth Scenario

  • • Base forecast: £500k revenue next quarter
  • • Optimistic (+20%): £600k - requires hiring 1 extra salesperson (£15k cost)
  • • Pessimistic (-10%): £450k - triggers cost reduction plan
  • • LedgerIQ shows net profit impact for each scenario

Cash Flow Forecasting

Predict future cash position to avoid liquidity crises and optimize working capital.

Cash Flow Forecast Components:

  1. Opening Cash Balance: Current bank balance from trial balance
  2. Cash Receipts Forecast: Based on revenue forecast adjusted for DSO (debtor days)
  3. Cash Payments Forecast: Based on expense forecast adjusted for DPO (creditor days)
  4. Capital Expenditure: Planned fixed asset purchases
  5. Financing: Loan drawdowns, repayments, dividends
  6. Closing Cash Balance: Rolling 12-week or 12-month projection

Early Warning System:

LedgerIQ flags periods where forecast cash balance drops below minimum threshold (default: £10k or 1 month of operating expenses). Allows proactive action before cash crisis.

RiQ AI Assistant

RiQ (Reconciliation Intelligence Quotient) is your conversational AI assistant for financial data exploration. Ask natural language questions and get instant, data-driven answers.

How RiQ Works

RiQ analyzes your actual uploaded financial data (not generic advice) to answer questions about trends, comparisons, and anomalies.

Example Questions You Can Ask:

"What are my top 5 expense categories this quarter?"

"Compare revenue this month vs last month"

"Why did my gross margin decrease in Q3?"

"Show me accounts with unusual activity"

"What's my current debt-to-equity ratio and is it healthy?"

"Forecast cash flow for next 3 months"

RiQ's Capabilities:

  • Data Querying: Instant access to any account, ratio, or KPI from your dataset
  • Comparative Analysis: Period-over-period, budget vs actual, industry benchmarks
  • Trend Explanation: AI identifies drivers behind ratio changes and performance shifts
  • Anomaly Detection: Flags unusual transactions or account movements
  • Visual Responses: Generates charts and graphs inline with text explanations
  • Follow-up Context: Maintains conversation context for deeper exploration

Privacy First:

RiQ processes your data client-side (in your browser) whenever possible. For complex queries requiring AI, only relevant summary data (not raw transactions) is sent to our secure API. Full privacy controls available in settings.

Advanced RiQ Features

Natural Language SQL

RiQ converts your questions into SQL queries against your dataset. No need to know SQL syntax.

You: "Show me all accounts with balance over £10,000"
RiQ: [Executes: SELECT * FROM accounts WHERE balance > 10000]
Returns: 12 accounts found, displays table + export option

Insight Suggestions

RiQ proactively suggests questions based on patterns it detects in your data.

"I noticed your debtor days increased 40% this quarter. Would you like me to analyze which customers are paying slower?"

Export Conversations

Export entire RiQ conversation as PDF or Markdown for client reports or internal documentation.

RiQ Best Practices

✓
Be Specific

Instead of "Show me expenses", try "Show me office expenses in Q4 compared to Q3"

✓
Use Follow-Ups

RiQ remembers context. After asking about revenue, you can follow with "Now show me by product line"

✓
Ask "Why"

RiQ can explain: "Why did my current ratio decrease?" - it will analyze the underlying changes

!
Verify Critical Decisions

RiQ is powerful but not infallible. Always verify numbers for critical decisions in the raw analysis modules

Professional Client Reports

LedgerIQ's reporting engine generates presentation-ready financial reports with one click - perfect for board meetings, investor updates, or client deliverables.

Board Pack Generator

Comprehensive PDF report combining all key analysis modules with executive summary and commentary.

Board Pack Contents:

  1. Executive Summary: One-page overview of financial position and key metrics
  2. Financial Statements: Balance Sheet, P&L, Cash Flow with period comparisons
  3. KPI Dashboard: Visual cards showing all critical ratios with traffic light indicators
  4. Trend Charts: 12-month charts for revenue, profit, cash, key ratios
  5. Commentary: AI-generated narrative explaining performance highlights and concerns
  6. Forecasts: Revenue and cash flow projections with confidence intervals
  7. Appendix: Detailed account listings and calculation methodology

Customization Options:

  • • Company logo and branding
  • • Custom cover page with date range and period
  • • Select which modules to include/exclude
  • • Add custom commentary and notes
  • • Adjust chart colors and styles

Time Savings:

Manual board pack creation typically takes 4-6 hours. LedgerIQ generates publication-ready 20-30 page board packs in under 60 seconds.

Export Formats

PDF Reports

Professional board packs and module-specific reports

Use case: Client deliverables, board meetings

Excel Workbooks

All data tables and calculations in Excel format

Use case: Further analysis, audit trails

Chart Images

Individual charts as PNG/SVG for presentations

Use case: PowerPoint slides, emails

Scheduled Reports (Coming Soon)

Automate report generation and delivery on a recurring schedule.

Scheduled reporting with automatic data refresh will be available in Q2 2025. Email [email protected] to join the beta program.