7 Forgottten Reasons – Why you need an effective, and efficient, accounting and reporting system in your business … if you want to MAKE MORE PROFITS!
Hi Duncan here from CapitalQ.
I was working on a short, sharp list of the key mistakes or short comings I see small business owners make so that hopefully you can avoid them yourself.
As doing so I kept coming back to a recurring theme, and that revolved around failings in their accounting and reporting systems.
Now of course I know that doesn’t sound very sexy, I’m sure you were looking for some ground-breaking ideas, out of left field, that will magically make you millions.
But the reality is, an awful lot of small business owners we see can and would make much more and could achieve much greater success if they just made a few easy to implement changes to the way they operate.
So I have put together my top 7 Forgotten Reasons why you need an effective, and efficient, accounting and reporting system if you want to make more profits.
Again, not a super sexy title, bit of a mouthful, but the more profits bit hopefully sparks your interest.
Now the list applies to all business owners, but in particular I want to call out relatively new business owners, those that are perhaps one to two years into their journey.
This period is so often the honey moon period for many new entrepreneurs. We see a lot of people in this early stage of their business who think they are making good money, who are thinking they have this whole business thing sussed.
But unfortunately you don’t know what you don’t know, and we see time and again people hit a wall around that 2 year mark when they start to discover the hard way all the costs and obligations and liabilities they were racking up without knowing it.
So lets get straight into it …
An effective accounting & reporting system is the “Minimum Price of Entry” to real business success.
We have seen it all, from tiny one person home businesses to financial services behemoths managing billions in client money.
And the real success, and the avoidance of failure, only comes when performance is recorded, reported, considered and then acted upon.
However YOUR TIME IS TOO VALUABLE to spend much, if any, of it on your accounts.
You as the business owner and driving force behind your venture should only focus on HIGH PAY OFF tasks.
I own two successful businesses and I don’t spend a minute on preparing the accounting and record keeping. And I’m an Accountant.
If meeting your tax and other reporting obligations is hard, then you are doing something wrong.
Tax lodgements are a regular occurring obligation that aren’t going away anytime soon.
Therefore you need an efficient process to ensure you can meet these obligations on time each time without drama nor interruption to your core business operations.
And doing so should never take up substantial, if any, amounts of the business owner’s highly valuable time.
If it is, you are doing something wrong and it is time to rectify the situation!
Accounting records are not just for the Taxman.
It was invented well before Income Tax Returns and Activity Statements.
Modern accounting was actually first conceived by the Merchants of Venice way back in the 14th and 15th centuries and they did so to provide the required useable and actionable information about their business.
It helped them amass great fortunes and it can help you do the same.
An effective and efficient accounting system is the FOUNDATION upon which a successful business is built!
Without a strong foundation, your business is little more than a house of cards, at the mercy of any change in the wind.
Your accounting and reporting system will help you identify trends, good and bad, and allow you to adjust accordingly, before it’s too late to reap the benefits, or otherwise to avoid a disaster.
You are flying blind without the information your accounting system should provide.
If you don’t have the information you need, you are doing nothing more than GUESSING each time you make a business decision.
You probably aren’t the type of person to put your life savings and your future on the line at the casino roulette table.
So why take effectively the same gamble with your business.
Finally, What Gets Measured, Gets Managed.
A cliché maybe, but in our experience it is 100% true and is a strategy that implemented correctly pays massive dividends.
Get yourself an effective and efficient accounting and reporting system, then start measuring your business’ key numbers and performance, and you will be amazed how better managed they become and the positive results that will be produced.
So there you have it, and now, as always, it’s over to you. Do you have what is required to take action and implement what you have learned?
If so, you are the type of person we want to work with, so please get in touch and let us help make it happen!