Part-time Cfo Services | Keeping Financial Information Current?
If entrepreneurs do not have current and up-to-date financial information in their business, they end up making financial decisions because they are unaware of what is going on financially in their business says part-time CFO services. Because of this, business owners can place unnecessary cash strain on the business, and even make decisions that could potentially force them to shut their business down. 50% of all entrepreneurs close their business within five years, and 29% of those entrepreneurs say that the reason their business failed was because they ran out of money.
One way that business owners can ensure that they have as current information in their business, is to a block their accounting department says part-time CFO services. Many business owners have a block their own schedules, and so how efficient and effective that was for them. They realize that all important tasks that need to get done will absolutely get done if it is in the schedule. In order to ensure that this works, a business owner needs to make a list of all of the tasks that need to happen in the accounting department. The matter how big or small the task is, or how important it is, a business owner needs to take into consideration every single thing that needs to happen. Then, a business owner can start creating the schedule, by looking for efficiencies on what makes sense to group things together in order to save time, or avoid duplicating efforts.
Examples of grouping together activities is if a business owner puts running payroll, and payables at the same time. This makes a lot of sense says part-time CFO services, because business owners will have to do a bank reconciliation before either of those activities before they proceed, so it makes sense to do only one bank reconciliation and then do both payroll and payables. Not only can this efficiency save time, but it can ensure that a business owner has enough money in their bank account to run payroll. The business owner does the bank reconciliation, sees that they have enough money in their bank account to make payroll, and then if there is anything left, it can go towards paying their vendors and their bills. Under this system business owners had before scheduling, they would write checks every time a bill would come in, and then have no idea how much money they have in their bank account in order to pay their employees. By running this information the same time, business owners never have to worry if they have enough money to pay employees, because they are the first to get paid.
This creates efficiencies as well as reduces errors and business owners can often find that they no longer need to have a full-time person working in the accounting department anymore. Instead, they can save their money and instead hire part-time CFO services to give them a much higher level of accounting services.
Without having up-to-date financial information in their business, part-time CFO services say that business owners often are unable to make great financial decisions in their business. When business owners aren’t able to make good financial decisions, they can place a strain on their cash flow, and even be forced to close their doors due to running out of money. 29% of all business owners who fail say that the reason their business failed was because they ran out of cash.
An extremely efficient way of organizing their accounting department is through a blocking says part-time CFO services. It works very well in offices and for business owners, and can work the same way for finances. Business owners need to be disciplined to ensure that it works, but once the schedule is created, all of the tasks that need to get accomplished do get done. Business owner should be not only scheduling in the time for all of the important tasks to get done, but they should also be looking for efficiencies, to see if there are any activities that can be grouped together because they make sense, and because they save time.
An example of such an efficiency, is when the business owner can grouped together the payables with the payroll. They can do one bank reconciliation says part-time CFO services, and then ensure that they have enough money in their bank account to pay their employees first, and then their vendors second. This will also allow business owners an opportunity to review the reports prior to making payments. The main reason for that is that business owners can compare their monthly balance sheet and monthly income statement to see what the payments look like before they are posted. Business owners should be checking for errors before they submit the reports.
Another way that this can produce errors says part-time CFO services, is that by reviewing the payables before they post them, a business owner can ensure that all the information that needs to go with the payables is accurate. This can help eliminate the risk of a business owner not remembering what a check or electronic fund transfer was later on. If business owners are making multiple payments multiple times a day, they often misplace the supporting documents, which ends up costing time at year end, when the accountant is trying to figure out what information goes with it. By posting payments only once or twice every month, business owners can ensure that not only are the payments correct, but all of the necessary supporting documents are accounted for.
By creating a schedule for their accounting department, entrepreneurs can ensure that every task that needs to get done actually does get finished, which ensures that their business finances are accurate and up-to-date. If a business owner needs to make a financial decision at any point in their business says part-time CFO services, a business owner can be certain that the information they have on hand will allow them to make the best decision they can, and avoid cash flow problems in their business.