In Pursuit of Profit
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 An accountant on a laptop with “KPI – Key Performance Indicator” written nearby surrounded by business icons and financial charts. Every day we talk to business owners and CEOs that are worried about how their company is doing financially, but recently there has been an uptick in uncertainty around the metrics they use to evaluate their performance as well. The trend towards questioning whether the business is measuring the right things or enough things is growing. More and more business leaders are asking things like:
Our partners over at CFO Selections have a number of financial resources meant for executive leadership, one of which breaks down the business sales process and explains why a CFO (Chief Financial Officer) is important during the sale of a business. As you get closer to selling, we would suggest reviewing that resource and reaching out to them if you need help.
However, today we are going to look at some best practices for creating and preserving value in your business well before you start going down the path of selling it. Our team of accountants will give some tips on what you can do financially to set yourself up for success as you get closer to selling.  When a company is undergoing a significant shift, like a big cultural change or a change of ownership, a financial assessment can give them a comprehensive picture of where they are financially to aid in their strategic planning. A business financial assessment helps with decision-making related to everything from short-term cash flow management to long-term vision-setting.
Over the last year and a half many companies have brought in consulting accountants and fractional CFOs to assess their current financial position. Let’s take a closer look at what a financial assessment includes and who is best poised to conduct one.  Written in conjunction with our partners at CFO Selections
A cash flow shortage is the number one reason why small businesses fail, but even mid-sized and large companies need smart cash flow management to survive and thrive. Insufficient cash forces companies to make difficult decisions about who is going to get paid and when. Unfortunately, this can lead to vendors and suppliers being paid late, being overdue on rent, even employees waiting on paychecks. It is not an exaggeration to say that cash is the lifeblood of any business. Not having enough money to pay for expenses can erode business credibility, which leads to:
Ultimately, a company’s potential will be stifled if there is not enough capital to invest in the assets that facilitate growth, and its very existence can be threatened as well. So, are you ready to manage cash flow for the coming year?  Are you paying for compliance accounting or advisory accounting? Do you know?
Compliance accounting is straightforward – it deals with day-to-day accounting, reporting, and tax preparation. But what about advisory accounting? The Intuit Tax Council defines accounting advisory services as, “Taking client challenges and applying strategies to create opportunities in service to their growth.” Accounting advisory interweaves technology, relationships, communication, and strategy to provide companies the fuel needed for profitable growth. “Finance” is a broad term every business leader has heard, but it can mean many different things.
Businesses have banking relationships, investments they need to track, fundraising and financial analysis needs. Corporate Financial Planning and Analysis (FP&A), the work performed by Financial Analysts, is a complex specialty within Finance that all successful businesses need in some degree. There are multiple FP&A components of which every business requires a different combination. This complexity makes hiring to satisfy your FP&A needs difficult. To make matters harder, many accounting and FP&A functions can overlap. So how do you know if you need to hire a dedicated Financial Analyst or a hybrid accountant? It helps to first understand the components of Corporate FP&A, the value each adds, and how much time each activity should take.  A guest post from our partners at CFO Selections.
With an increased focus on financial planning and analysis (FP&A) in recent years, many companies have begun asking, “Do accountants do financial planning?” For cash-strapped startups and small businesses the temptation to simply add to their accountant’s workload is strong. However, this is not a wise decision. While overloading any one role presents problems on its own, entrusting accountants with FP&A poses its own unique risks. The differences between accounting and FP&A necessitate that it be handled by separate personnel with unique skillsets and performance objectives. Understanding what FP&A entails and what is at stake can help organizations make smart decisions about who should handle this critical responsibility.  It is undeniable that top business performance requires the right financial tools and resources.
Having the right pieces in place provides better data and drives results. And while there are literally millions of online tools and apps and software programs for ecommerce companies to use, using the right financial tools can be the real differentiator between successful businesses and their competitors. So, what kinds of ecommerce financial tools are essential?  A guest post from our colleagues at CFO Selections:
When adversity hits, the knee jerk reaction is to swiftly cut spending across the entire organization, but that response is a mistake. Strategic cost cutting can keep a business going through tough times, but it must be approached with long-term value in mind. Reducing costs should abide by three essential principals:
Evaluate your spending and determine where you can cut costs to weather tough times while still protecting critical functions, minimizing long-term expenses, spending where it could end up costing more not to do so, and looking for opportunities to reduce waste.
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7/24/2023