“It’s like you’re speeding down a country road at midnight with only your park lights on”, I recently commented to a new client. Scary thought.
The problem was their internal accounting team, who were ill equipped for the requirements of a rapidly growing, idea rich and cashflow poor organisation.
This is not unusual. Some of the quickest and most enduring gains I’ve implemented with clients have simply involved upgrading their internal finance function. Not only does it result in better information on which to base decisions, but the engagement of a competent accountant helps set the tone for the rest of the business: timeliness, accuracy and insight.
What about your business? You may have your headlights on but are they at full beam?
As a business grows, it is common for the finance function not to grow with it. The book-keeper with no formal training may have been sufficient four years ago but now…?
Here are some signs that change may be in order:
– it’s the 20th and you’re yet to receive management accounts from the previous month
– you’re finance person doesn’t regularly mention the word ‘cashflow’
– they haven’t attended any external training in the past six months
– you receive the accounts but no commentary or analysis
– you find yourself relying on your external accountant more than your internal one
The biggest benefit in upgrading is having your financial information interpreted, not just produced. Hopefully the interpretation will be accompanied by recommendations. If you only have the need for one individual, and the dual role of production, interpretation and recommendation is too great, consider engaging the services of a virtual CFO.
I’ve found return to work mothers a great choice of part timer, when a full time resource is not needed. In return for offering flexibility in working hours you tend to receive a much higher skillset than you’d get otherwise and a very competent multi-tasker!
As with a lot of roles, hire on attitude. Skills can be learnt but approach and engagement tends not to change. If your existing accounts person has been in the role for a number of years then trust me – a new approach and set of ideas will be amazingly refreshing.
And when it comes to accounting software, look no further than Xero. I’m a big supporter of them (no, I’m not a shareholder) and am yet to meet a convert that regrets the move from their old software.
Please drop me a note if you’d like any other ideas on illuminating your internal accounts team.