The right accounting and financial management systems are central to your business success. But systems are just systems. It’s how you use and develop them that really counts.
It’s great that you’re in the cloud and using real-time numbers, but are those numbers helping or hindering your financial and business management decisions?
Effective financial management relies on effective accounting systems that deliver accurate information that is a true reflection of your real-time financial position. And, while many business owners take steps to update their accounting systems, that’s no guarantee the reporting will be accurate. Missing crucial elements can skew your figures with repercussions showing up later, often in the form of insufficient cash.
When I work with clients, an early recommendation is for a systems audit, especially if the client has an established cloud accounting system.
In my experience there’s often a disconnect between what a technician sets up (even if that person is your bookkeeper) and what’s required by those who rely on those systems for financial management and critical decision making. Make Cents system audits regularly throw up red flags that have previously gone unnoticed and, if left unattended, have the potential to adversely influence the business and in turn, your personal prosperity.
As your accountant and External CFO, I need to know that I can trust your numbers.
This allows me to confidently develop financial management strategies for you to implement.
Those strategies commonly include eliminating the lumpy cash flow that can result when you work with tight margins or on special projects and, importantly, when you are on a growth trajectory.
Sustainable cash flow will help you to thrive and prosper, rather than grow so quickly that your cash is eaten up and your business, along with your future, is at risk of dying from starvation.
Clean systems deliver clean financial reports that provide a true reflection of your financial position.
Other benefits include less stress and more confidence when making decisions and seizing opportunities. You’ll be secure in the knowledge that your cash flow is reliable and your business more valuable and more attractive to potential purchasers.
So, what should you do next?
Rather than accept the default set-up, insist that those systems are customised to suit the specific financial management requirements of your business and to support your business decision making.
Then, organise a Systems Health Check to make sure everything’s up to scratch.
If you need help, please give me a call. System design is central to what we do because sound systems drive not only your business success, but also your personal prosperity.
Click here for earlier articles in my Live Long & Prosper series:
#1: Set a course for smooth cash flow – Make it so!
#2: Systems – Logic is the beginning of wisdom, not the end!
#3: Coming soon – Sustainable Cash flow: A library serves no purpose unless someone is using it.
*Mr Spock – Star Trek IV The Undiscovered Country