Numbers Matter. There is this misconception out there that accounting is only for the elite few, for those who have attained a Ph.D in Finance. Eyes glaze over when Excel spreadsheets are included in a meeting packet and translators are required, sometimes even a secondary translator is necessary for the CFO’s summary. Business owners aren’t sure exactly where or why they are making money but they are sending thoughts and prayers to the accounting gods. Every day.
It doesn’t have to be this way. Technology brings accounting best practices to the people in ways that make sense to those who may not be able to define GAAP or accrual or even the basic accounting equation. Small and even mid-size businesses do not require a full-time accounting team but they do need to commit to investing in solid bookkeeping practices.
The real-time reporting that technology offers is only as good as the data entered so handling transactions in the right way makes all the difference. For instance, creating a chart of accounts that reflects your unique business model, detailed invoicing and tracking expenses to the proper accounts are all critical to churning out accurate reports, based on facts not feelings.
Are you able to run profitability reports by different revenue streams or product lines or projects? Do you regularly compare year over year numbers? Can you see at a glance what you owe your vendors and what your customers owe you? Where are payroll costs making the most impact on your bottom line?
This kind of honesty in data may be hard to look at sometimes but is absolutely necessary for making good business decisions. And it starts with a good set of books.
Don’t be intimidated by accounting. Numbers matter but it’s not rocket science. Ginger Lee can help you craft bookkeeping solutions that make sense of your business.