Units of figures representing millions
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What is MM?
In finance and accounting, MM (or lowercase “mm”) commonly denotes that the units of figures presented are in millions. The Roman numeral M denotes thousands. In this context, MM is the same as writing “M multiplied by M,” which is equal to “1,000 times 1,000,” which equals 1,000,000 (one million).
While Roman numerals are technically additive (MM is really 1,000 plus 1,000 or 2,000), MM is still a fairly common way of abbreviating millions, especially in certain industries like oil and gas. This guide will explore how the notation should be used, as well as alternative symbols that are used in practice.
Example of MM in Financial Statements
The Roman numerals MM are frequently used to designate that the units used in presenting information (financial and non-financial) are in millions. The example below shows how figures can be portrayed in millions.
As you can see in the figures above, net income and preferred dividends are labeled as being $mm (millions of dollars), shares authorized and shares outstanding are labeled as mm (millions of shares), and earnings per share (EPS) are labeled as $/share.
In this example, we intentionally chose a piece of analysis that contained various different units, such as dollars and shares. When an analyst must present various different types of units, it is recommended to add a “units” column so that each item contains a label for easy reference.
When preparing financial statements, accountants will typically write a note at the top of the income statement or the balance sheet saying, “All figures are expressed in millions of U.S. dollars,” for example.
Download CFI’s Excel template to edit the figures yourself.
Alternative Notations to MM
The use of two m’s to denote millions is becoming less common. Frequently, in finance and accounting settings now, an analyst will use k to denote thousands and a capitalized M to denote millions.
For example, $100k x 10 = $1M
The table below summarizes different notations you may encounter in business.
| Hundreds | Thousands | Millions | Billions | |
|---|---|---|---|---|
| Written | $ hundreds | $ thousands | $ millions | $ billions |
| 0's | 00's | 000's | - | - |
| Roman | - | m | mm | - |
| Modern | - | k | M | B |
Unfortunately, there isn’t a consistent approach to labeling units. The least ambiguous approach is to simply write them out in words, such as “$ thousands.” This is CFI’s recommended method, to avoid any potential confusion.
Additional Resources
Thank you for reading CFI’s guide to MM (Millions). To continue learning and advancing your career, these additional CFI resources will be helpful:
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Now, let's delve into the concepts presented in the article about MM (Millions) in finance and accounting:
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MM Definition and Usage:
- MM, or lowercase "mm," is a common notation in finance and accounting that signifies figures are in millions.
- The Roman numeral M traditionally denotes thousands, so MM essentially means "M multiplied by M," equaling 1,000 times 1,000, or 1,000,000 (one million).
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MM in Financial Statements:
- MM is frequently used to label units in financial statements, such as net income, preferred dividends, shares authorized, shares outstanding, and earnings per share (EPS).
- In financial analysis involving various units, it's recommended to include a "units" column for clarity.
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Alternative Notations to MM:
- The use of two lowercase m's to denote millions is becoming less common.
- Instead, an analyst might use "k" to denote thousands and a capitalized "M" to denote millions. For example, $100k x 10 = $1M.
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Table of Notations:
- The article provides a table summarizing different notations used in business for hundreds, thousands, millions, and billions.
- Examples include "$ hundreds," "$ thousands," "$ millions," and "$ billions."
- Roman numerals (e.g., "mm") and modern notations (e.g., "k" and "M") are compared.
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Ambiguity in Notations:
- The article acknowledges the lack of a consistent approach to labeling units in finance and accounting.
- The recommended method, according to CFI, is to write out units in words, such as "$ thousands," to avoid potential confusion.
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Additional Resources:
- The article concludes by thanking the reader and providing links to additional resources on financial statement analysis, becoming a financial analyst, and financial modeling.
In essence, the article serves as a comprehensive guide to understanding the use of MM in financial contexts, offering insights into its historical context, practical applications, and alternatives in notation.
