Updated: Sep 20, 2019
All businesses have to prepare financial reports and summaries, but the majority of small and medium sized enterprises don't use 'Financial Reporting' to their full advantage.
Your financial reporting, if properly utilised, will be the key to unlocking your growth potential, to discovering beneficial business funding options & opportunities and to creating a new and more successful path to your business profitability and growth.
When it comes to reporting, almost all businesses will at least have a Profit & Loss Account and a Balance Sheet. However, for a lot of companies, preparing these reports can be more of a year-end obligation and 'chore' than a week on week, 'real time' valuable exercise in performance review and business insight that if undertaken would in fact reshape the way the company makes its decisions and internally and externally operates.
Aside from glancing over your financial statements when you have to make a big financial decision or periodically examining your annual financials from past 'unchangeable' periods, businesses should be TRACKING THEIR FINANCES in real time, day to day, week on week to properly monitor every aspect of their performance and using this information to make real time key decisions for the business stage by stage and department by department.
To operate a business successfully management need to always;
Update company financial statements in real time
This may seem obvious, but all too often when financial reporting is seen as routine, it can fall behind.
For smaller businesses in particular, this can bring major problems, especially when their finances and accounts are prepared and managed externally and are treated as complete without proper review and full financial interpretation for best use.
Even if the reports are out by just months, the management could be making some of the most important business decisions based on inaccurate data.
Keeping a realistic and accurate view of your company’s financial situation will not only help you make better decisions, it will alert you sooner to any potential issues or gaps in cash flow.
Appoint an expert
You don't need to 'employ' an expensive team internally or 'employ' a Finance Director or CFO to access expert services such as these. These services can be accessed at a fixed cost on a consultancy basis, for example; weekly, monthly or quarterly, to provide you real time support and advice, keep you up to date and fully informed of your businesses position by way of regular real time financials and by the ongoing monitoring of your Key Performance Indicators.
Getting the right advice at the right time can be invaluable and can make the difference between business success and early years failure.
By appointing a 'Virtual FD' with a plan to suit your business needs and budget, your business can make the most of analytics and reporting for better decision making and growth.
Check your credit report regularly
Surprisingly, a large proportion of businesses don’t regularly obtain and check their own credit report.
While some businesses may take the opinion that this is unnecessary as they have more detailed financial data internally, it’s crucial to know what external companies see when they research your business.
Routinely checking it is important to gain a good external picture of your circumstances. Obtaining a copy of the report is quick and easy to do and can give you a good indication of your overall business credit health and may improve your chances of accessing finance.
Maintain and where possible improve your credit rating
Pay all your invoices on time
File annual returns and financial accounts on time
Avoid CCJ's wherever possible and, if you do receive any, settle them within a month
Keep an eye on your personal finance, as directors’ personal credit history may be taken into account when there is limited company data
If you are looking for assistance with preparation of financials and real time management and performance reporting, for sourcing funding for your business, or for improving your working capital and cash flow; CONTACT US at FXEM Money Management UK Ltd. We will assist you with a free consultation and guide you to a suitable plan of expert advice.
FXEM Money Management UK Ltd +44(0)843 289 8893
Walsh West Chartered Certified Accountants +44(0)843 289 4543