Whether you use accountants in Manchester, London or one that works remotely from a different country, an accountant is an important and valuable asset to any business. But, how much do you use the input of your accountant to drive your business forward?
1 Forecasting and Budgeting
For any business to survive, let alone thrive, it needs to break even or, even better, post a profit. Losing sight of your finances is not a great way to run or to grow a business. An accountant is a specialist with the knowledge to guide you in many key financial areas including forecasting and budgeting.
· Forecasting – this is a financial guestimate based on past performance and taking into account current market conditions, as well as other factors, that predict what the next few months or years could hold for your business in terms of financial pressures and opportunities.
· Budgeting – if you spend more than you make, the shortfall and the results will be catastrophic. In the short term, your business may be able to shoulder this but without proper budget setting and monitoring, your business is doomed to fail.
2 Identify KPIs
Financial success is not the only measure of success potential customers and stakeholders are interested in. what key performance indicators (KPIs) show that your business is on a sound footing and the one to do business with?
Accountants have the ability and the knowledge to be able to pull these KPIs from your business. It could be the increased turnover of products on your production line to improving rates of delivery and efficiency.
3 Cash Flow Projections
Cash flowing in and out of your business must be monitored but more importantly, understood. It is a sad state of affairs but many businesses that have gone to the wall have done so because cash flow was stuttering and stagnant. As well as chasing customers for payment, you also need to project where bottlenecks in cash flow could present a problem.
Again, an accountant with their finger on the pulse of your business could project this information, helping you to determine when sticky patches could arrive.
4 Industry Benchmarks
You are not the only business to dominate your sector. Remaining competitive is about pushing ahead with products and services, offering something more, bigger, better than you main competitors.
Developing your business is key and that means working ON your business, as well as chasing more orders, bigger orders and more customers. What you may not have a chance to do is to spend time understanding how your competitors are operating, the KPIs they are hitting and so on.
An accountant with their finger on the pulse of your business and the marketplace is a valuable resource for you. They can measure your business against others, determine your current position and suggest changes that will make your business financially more in tune with the market place.
5 Value Your Business
Raising capital is essential for many businesses to grow and develop. Essentially, part of this process is letting potential investors know key information, from the value of your business on the open market today and its project value with growth in the future.
Do you really know how much your business is worth? Your accountant can provide financial information in a way that makes sense.
6 Becomes Part of Your Management Team
Finally, whether you bring an accountant in-house or continue to outsource to leading accountants, an accountant is a valuable and specialist asset to the management team of your business. They have the specialist financial knowledge, from corporate tax to cash flow projections and more that your business – and your team – needs in order to grow and steer your business to success.