From a financial perspective, I would say that the number one issue for small businesses is having access to accurate financial information when they need it. Many new prospects tell us that they don't feel as though their financial reporting is accurate and they don't look at reports often enough. So how do you get accurate financial reports for your small business in a timely manner?
Develop A System
The first step to getting timely financial reports is to develop a bookkeeping system. You will need to first identify what it is you want from your financial reporting.
One of the crucial steps is identifying the key metrics that you need information on in order to make calculated business decisions. Make sure that your chart of accounts and bookkeeping system are tailored toward reporting on those metrics.
Daily Or Weekly Bookkeeping
After you have developed a bookkeeping system, you need to update it regularly in order to have timely financial reporting available. We recommend daily or weekly; at the very least, you should update your books once per month.
We are huge fans of daily bookkeeping for a few reasons. First, daily bookkeeping is incredibly powerful because you always know exactly where you are at with your business. Since your books are always up-to-date, so are your reports; this in turn solves your issue of timely financial reporting. It also allows you to be a master at cash flow management. Daily bookkeeping gives you an accurate cash balance every day and shows you not only where cash flow is, but also where it is going.
Commitment And Accountability
Next, you need to commit to the system and hold yourself or others accountable. Whether you decide on daily, weekly, or monthly bookkeeping, it won't matter if you don't commit to making sure those updates happen. Bookkeeping has a tendency to find its way to the back burner for a lot of small businesses. The more it gets pushed off, the farther behind it falls; and so begins a vicious cycle. You need to hold the person in charge of updating the books to the promise of staying on schedule, no matter whether that is you, an employee, or an outsourced solution.
Outsourced Bookkeeping Solution
One way you can make sure that your books get updated and your financial reporting remains accurate and current is by engaging an outsourced provider. With this solution, you are paying for accuracy and timeliness. One thing that we pride ourselves on is that our clients can pull updated financial reports any time they need.