In Pursuit of ProfitExperts sharing tips about business, money, taxes...
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In Pursuit of ProfitExperts sharing tips about business, money, taxes...
to support your mission and improve profits. See our most recent article below. SUBSCRIBE! >>> |
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In an article on how consumers are responding to inflation Andy Pandharikar explains, For many years, the inflation rate in the United States has been relatively low, hovering around 2%. However, in recent months, that rate has increased dramatically, nearing 7%. However, if we measure according to the Bureau of Labor Statistics’ methodology from 1980 that figure exceeds 13%. Inflation in specific categories like ground beef has been even higher, nearing 20%. As prices rise more quickly than wages, many consumers are finding it difficult to afford basic needs. Of course, the risk for businesses is significant. Improperly managed pricing can either cost the company its customers or its profits, either of which ends in failure. Prices need to hit a sweet spot where they can generate profitable revenue and are because enough people are buying.
12/12/2022 Controller or CFO – Which Do You Need?At this stage, companies are feeling the limitations of their existing accounting personnel and are evaluating what their next move should be to keep the company moving forward. But knowing whether to hire a Controller or a CFO is a big decision, because, contrary to popular opinion, the roles are distinctly different.
As Kevin Briscoe, the CEO of CFO Selections, explains in nonprofit leadership podcast, “A Controller is ‘walls-in and rear-facing’ and a CFO is ‘walls-out and forward-facing’.” He goes on to explain that a controller analyzes what the company has done already while a CFO evaluates where the company is going next.
If the economy slows down significantly enough for a long enough period of time, we will be in a recession. But regardless of what we call it, the economy is slowing down. We know this because current economic indicators show that:
These numbers reflect an economy that is surely slowing, which means that businesses must be prepared to react accordingly by preserving cash flow. The key in determining how to respond will be in understanding what this slowdown is going to look like for business activity. While outsourcing overseas used to just be a cost-saving measure, many accounting firms are now facing labor shortages that are forcing them to take this step out of necessity, not of their own choosing. The Washington Post declared that “The remote revolution could lead to offshoring Armageddon” and though that is likely an exaggeration, it demonstrates how desperate many employers are these days to find personnel to do the work that needs to get done.
CPA firms, large employers, and companies with complicated ongoing financial needs are in a pinch. They need skilled employees to do the work that keeps their businesses running but with a dearth of qualified candidates available, their options are limited. However, offshoring is not the only solution! It is often a far better option to upskill your existing employees to assist with this work than to send it overseas. ![]() As a fan of Star Trek, one thing I like to ponder about is the concept of time dimensions. Can you be in two points of time at the same time? For many people, living in a pandemic has made the sensation of time change. Things have simultaneously seemed like they happened long ago and also only yesterday. And, at one point or another we have all thought, “It seems like it was years since I saw you. Wait, it has been years!” But time has more than just social implications. The concept of time is relevant to you professionally as well, especially as an accounting manager or a member of an accounting team. To have an effective accounting and finance team, an individual’s time view preference must match their job responsibility. If it is not, your accounting operations may suffer, and your company may experience unnecessary attrition. What do I mean? 1/18/2022 How to Handle Excess Inventory![]() While many companies have faced materials and components shortages leading to stock outs since the start of the pandemic, many other companies have been sitting on excess inventory due to transportation challenges, shifting consumer patterns, and tightening sales distribution channels. Excess inventory occurs when a business holds more stock than is needed to meet their forecasted demand. It can be the result of flawed forecasting, purchasing errors, improper inventory management, or business disruptions. The latter is what many organizations have been dealing with since early-2020. But, regardless of the cause, too much inventory can cause both financial and operational obstacles. If your company is carrying an abundance of inventory, it is important to act quickly to get it off your books and out of your warehouses. Use this guide to understand why excess inventory can be a business killer, and what to do about it! ![]() 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. ![]() The last decade has ushered in a digital revolution across all business areas. However, many businesses are still dragging their feet when it comes to automating their accounting and finance activities. In fact, 58% of finance teams surveyed indicated that they do not feel their finance back office is “sufficiently automated.” Despite a plethora of tools and platforms available to help streamline these critical business areas, it seems many businesses are stuck in the past, relying on manual processes for their daily accounting functions. But organizations can use automation to drive profitability if they understand its benefits and can identify areas where AI will help them the most. ![]() 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. |
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