Financial Reports Don’t Match Sales Data? Huh?

So you’ve signed up for your developer account, paid your dues, slaved over programming your app, persevered through the review process, and had millions of downloads (or, maybe a little less. . . ), only to get the financial report at the end of the month and wonder what happened.  Your projected profit from Appfigures, Appannie, Appviz, etc. was more than the financial report claims.  You’re now calling your local Nissan dealership to cancel that order for a new GT-R.

Well, there’s probably not as much of a problem as it initially seems.  There will almost always be some discrepancy between your “Sales and Trends” data and your financial report, due to one of three factors:

1. Fiscal month vs. Calendar month
This is the most obvious mistake some developers make when predicting their months’ earnings.  Make sure you aren’t adding up the entire calendar month’s sales data. Instead, go into iTunes connect and look at the “Fiscal Calendar” link under “Payments and Financial Reports.”  This shows the exact dates each Apple fiscal month includes.

2. Currency Conversions
Remember that you can’t just take your downloads times price times 70% to get your final profit.  Apple does not adjust foreign app store prices for changes in currency conversions on a regular basis.  Also, keep in mind the currency rates can change from day to day, so they may be significantly different from when the sales occur to when payment takes place.

3. Adjustments for Clearing of Payments
Now for the biggie.  This is what most new developers don’t take into consideration.  The “Sales and Trends” data reports what you would expect: the actual amount of downloads during that day.  However, for the financial report, it actually doesn’t matter how many downloads took place in that fiscal month.  What matters is how many payments went through during that month.  This typically occurs at least a couple of days after the customer downloads the app, since most people pay with credit cards.

Therefore, to get a more accurate projection of what your financial report should be, shift the fiscal calendar back 2 or 3 days.  Many developers have seen a major discrepancy, for instance, on the December 2010 month, because it ended with Christmas day; however, the sales from that day (traditionally much higher than sales of any other day in the year) will actually be included on the following month’s financial report.

Conclusion
Because of these three factors, unfortunately, there’s not any way to 100% accurately predict what your total earnings for a month will be until the financial report comes out. However, if you take these three factors into consideration, it should start to make more sense, and you can get a more accurate projection before the report comes out.