We all want to get the best possible value for the time we spend with our accountants. Talk openly about any new ideas you have for your business, and the potential impacts on your finances. By working together, you can identify ways to tighten your cash flow processes and identify new ways to fund lead generation practices. It starts with open conversations and an honest look at the books, writes Sonia Gibson, director of Accounting Heart
4 questions to ask your accountant to ensure your using data for growth
1. Is my business financially healthy?
Your accountant uses your profit and loss statements (P&L) to calculate your revenue. Your accountant will also use the data from your balance sheets to create a financial snapshot of your business, giving you a summary of your business’s overall financial health. This information is generated by looking at all the assets and liabilities at a specific point in time. Knowing if your business is financially healthy is important, at all times. If you experience a dip in revenue, establishing why it has happened can help you to find ways to counteract it and keep your business numbers in a healthy region.
2. Ask your accountant: is my cash flow healthy?
Your accountant will have a statement of your business cash flow. This report will summarise the movement of money over a period of time, showing you where you have cash inflows, outflows, and plateaus. You want to have a healthy influx of cash to balance outgoing amounts. Knowing exactly how much is coming in and going out is essential for your business growth. If there are problems, your accountant can help you find ways to address the challenges, like tightening up your invoicing system or perhaps introducing a third-party debtors service to chase your unpaid invoices.
3. Factoring in the financial data before us, how do we facilitate growth?
Following on from the previous questions, you have insight into the general well-being of your business from a financial perspective. How can you use this data to improve your finances? You don’t have to know how to implement change or tweak existing processes based on the findings of your accountant. Your accountant is here to help you with that – but you must ask. Discuss any new ad campaigns, expansions, challenges, and ideas you have in light of long term growth and strategy.
4. Where are my potential weak points and how can I address them?
Every business has its own potential Achilles heel. Do you know what yours is? The weak point in a business’s financial system isn’t necessarily going to present a problem. It’s not always a ticking time bomb. However, knowing where your weak points are can help you to improve the integrity of the business and make it more resilient, especially in challenging times.
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