What does this tool answer?
Sales went up but profit went down? Or the other way round? The tool reads the trial balance for two years and explains where the change in net profit came from, item by item: how much the increase in sales added, how much the cost of sales took, and how much each expense group took, in a “waterfall” chart that starts with last year's profit and ends with this year's profit.
It also shows the income statement accounts that went up or down, and the accounts that are new this year or that stopped, sorted by the largest difference.
The formulas
- Change in net profit = net profit for the current year − net profit for the previous year.
- Effect of sales = current net sales − previous net sales.
- Effect of cost of sales = −(current cost of sales − previous cost of sales): an increase reduces profit.
- Effect of each expense group = −(current expense − previous expense).
- Effect of other income = current other income − previous other income.
- The total of these effects equals the change in net profit exactly, because net profit = net sales − cost of sales − expenses + other income.
- Accounts are matched between the two years by account number, and if there is none, by name after normalizing hamzas and spaces.
Worked example
In the previous year: sales of 1,000,000 SAR, cost of sales of 600,000, salaries of 200,000, rent of 60,000 and other income of 10,000, so net profit was 150,000 SAR. In the current year: sales of 1,200,000, cost of sales of 700,000, salaries of 240,000, advertising of 30,000 (and no rent) and other income of 5,000, so net profit is 235,000 SAR:
- Change in net profit = 235,000 − 150,000 = 85,000.00 SAR.
- Effect of sales = +200,000, effect of cost of sales = −100,000, effect of salaries = −40,000, effect of rent = +60,000, effect of advertising = −30,000, and effect of other income = −5,000.
- The total of these six effects = 85,000 SAR, which is the change in net profit itself.
Limits of the tool
The comparison is only as accurate as the account classification in the two trial balances: if an account moved from one group to another between the two years, its effect appears in both groups. The tool uses closing balances for income statement accounts, so upload a full-year trial balance for each year. This is an estimate based on the numbers you entered, not financial or investment advice.
Frequently asked questions
Do the two trial balances have to come from the same system?
Why does an account show as “new” when it exists in both years?
Are my files uploaded to the server?
Content last reviewed: 2026-10-28