Is Aunt Helen still doing your books? Or perhaps even a more delicate question: is your spouse still doing your books? This type of situation leads to many of the most common small business finance problems we see.

In the beginning, it was simple to hand over the bookkeeping tasks to someone you could trust, and it didn’t matter that the person was not an accountant and didn’t have a business finance background.

You just wanted to make sure you knew how much money was in the bank and the bills were being paid. When the business was this small and uncomplicated you could track where all the money was coming from and where it was going. You knew what your profit margins were on every sale you made. It lightened your load to have Aunt Helen take care of the books.

Now you know there is more to understand about the finances of your business.

Now that you’ve grown it’s getting harder to make sure ends meet to cover all costs, expenses, payroll, debt payments, taxes, and still have enough left over to pay you what you deserve. There are more transactions, more employees, more customers, more vendors. You lack the clarity you used to have when things were small and uncomplicated.

Your growth has you asking more questions about finances.

Can you survive the growth you have planned for this year? Sales are increasing, why does it seem like there is less cash available to pay all the bills and cover payroll? What financial reporting should you be looking at to make sure that your team is hitting the profit margins needed to produce a positive cash flow after all disbursements? The lack of financial clarity is a little bit scary.

A lack of financial clarity is holding you back, maybe even causing some sleepless nights.

If any of this is ringing true, then you know it’s time to fire Aunt Helen. Well, fire her from the finance department, anyway. If you want the rest of your family to still like you and invite you to a holiday, you might need to find something else productive for Aunt Helen to do. But now that you’re grown, that shouldn’t be too hard.

It’s time to establish an accounting system that provides you with the financial information you need to grow your business on a solid foundation.

And, since you may not even be sure what information you need or how to interpret and leverage it to build that foundation, you may need to bring in some outside expertise.

You can get more financial clarity in one of two ways.

One option is that you could try to hire and staff the expertise you need in-house. This brings some obvious challenges. Your business must be able to afford to pay for this higher level of full-time expertise. There is the challenge of knowing how to identify the skill set you need to hire. Add to that – if you don’t have financial clarity yourself, how will you be able to provide direction and clarity to in-house financial staff? Wouldn’t this be a case of the blind leading the blind? 

Alternatively, maybe it’s time to talk to an accounting firm that understands where you’ve been and where you are and will give you financial information you can use to strengthen your business. 

This is why we exist. 

Ready to get started? Financial Optics is here for you.