From an accounting point of view, a cancelled order should not be included in the sales report unless there is a contra transaction cancelling the order. As the order did not go through, no goods left the building, no money has entered the bank (or has been refunded/chargebacked/etc) and thus no sale has really happened. In effect, by keeping cancelled orders in the reports, sales are overstated and companies/owners are being taxed on profits they have not made. In an old fashioned way, if I had sent a sales invoice out to a customer and then they cancelled the order, I would then send a credit note to them - this would remove the cancelled order from my sales. Shopify - it would probably be a good idea for you to look into this one - as I mentioned, you may be allowing business owners to be taxed too much.