Warning Signs That Your Accountant Isn’t Helping You to Grow Your Business
Posted on 17th February 2017 in Business
Written by James Marren
‘Compliance’ the word even sounds restrictive, more suited to a Victorian classroom than 2017. Well, that’s how we feel about accountants that only offer history lessons and tax advice, they belong in the past too. With far superior advisors available, using technology that helps them predict and plan your future, it’s time to ask yourself: Is your accountant doing enough to help you and your business reach its potential?
Q: How often do you hear from your Accountant?
Do you think that your accountant is just someone you speak to once or twice a year? Usually at the time they are “presenting”, more often than not, bamboozling you, with your year-end financial report. There is little benefit to be gained from an accountant telling you this or that “didn’t quite work” at the end of the year when you’re no longer in a position to action a positive change. Where was this advice when you needed it six months ago?
From the feedback we’ve received from both business owners and accountants, the optimum is a monthly meeting but, at a bare minimum, quarterly. In business, a lot can change in 30 days, particularly when you are trying to grow your business aggressively, and opportunities and problems are constantly arising. Remember, you don’t have to waste hours traveling to each other’s office every time. Your catch-up could be just a quick call or FaceTime.
Having an experienced advisor as a sounding board, who can offer insights into what is making your business really tick, as well as helping you with solutions, based on their experience helping others with similar challenges, makes good business sense. Don’t underestimate the value of being held accountable or of having a regular review process and structure in place either.
Q: Has your Accountant told you about the benefits of cloud software?
The cloud is disrupting every industry and, for business owners who prefer doing what they love rather than working on their finances, this business-process transformation is substantial. If your advisor hasn’t told you about the benefits of the cloud for your business, as well as the time it can save them on the ‘admin’, warning bells should now be ringing loud and clear. Using a desktop solution for your accounting can double or triple the time it will take your accountant and you to stay on top of the books and more time equals more expense for you.
For example, Xero and QuickBooks, are cloud accounting platforms that make your data and software available online at any time, using any device that has an internet connection. They integrate with your bank account and automatically update your daily transactions. This is just one example of where time can be saved on dreaded data entry for you and your accountant. However, if your accountant uses desktop software the real worry for you should be that you can never have a good grasp on the health of your business. What do the insights tell you to action? They won’t know because they are spending their time, and your money, on preparing the data. Leaving little time, if any, for analysis. It’s your business, your financial data and your insights. You should have access to it anytime, anywhere so you can make informed decisions at the right moment. Don’t subject your company to unnecessary risk because your accountant hasn’t moved with the times.
Q: Does your Accountant help you to make decisions about the future?
Do you have a clear, confident picture of the next 3, 6 and 12 months? What will happen if you expand this year? Can you afford to hire a team of 5 versus 3 in your new marketing department? Every single decision you make will affect your financials now or in time. That’s why the best accountants are not only helping you to stay compliant. They are working with you to plan, predict and manage your future. For example, our advisors, use FUTRLI to work with their clients on tomorrow’s insights, today. If you have several Forecasts to reflect a range of “What if Scenarios” (optimistic, pessimistic and most likely), you are planning for every eventuality and not leaving yourself wide open for surprises. This is much easier when you are working in collaboration with your team and advisors – many hands, and more brain-power, makes light work.
Q: Has your Accountant discussed your KPIs with you?
We are sure you are familiar with the term ‘KPI’. However, we have a different approach to its meaning and usage. Rather than ‘Performance’, which concentrates on the past, we focus on ‘Key ‘Predictive’ Indicators’ that look towards the future. Your accountant should be looking at both with you and helping you identify the ones that will drive action, and financial performance, in your business.
If you consider a car dashboard, for example, it’s a great demonstration of Key Predictive Indicators working well. When the red oil light comes on, action is taken, and oil added. If the KPI is ignored, and no action is taken, then your car is going to breakdown. This concept also applies to your business, and your accountant should help you set up your ‘Car Dashboard’ equivalent. If they don’t know what your KPIs are then how can they help you affect the results of your profit and loss?
Q: Does your Accountant celebrate your success or pre-warn of your issues?
Have you smashed your sales target? Is your Accounts Receivable looking too light based on your sales? Is your Average Spend less than you’ve submitted to the Bank in your forecast? You cannot have your eyes on the detail, all the time. But, you also shouldn’t have to. If your advisor has your best interests at heart, it will be second nature for them to be one step ahead of you when it comes to the detail and straight on the phone, text or email to keep you informed when it changes. You and your business deserve to work with someone who has got your back and supports you in good times and bad.