I feel strongly about the relationship of our bookkeeping service and the success of our clients – Why? Because the numbers don’t lie. Our society is based on a relative sense of right and wrong. Daily, it seems we hear of a new national disaster, a poor decision made by our national leaders, or of pending economic disaster. The reality is our business is something we can improve.
As business owners, we have the ability to make changes so our businesses are more successful. The key is making the right decisions at the right time. This is where good accounting information is so important. The first step is good information. This is how a bookkeeping service comes into play. Bookkeeping data accuracy is essential to good decision making.
The second step is using the information to make decisions. This should come in two main forms-project specific data and daily review. Project specific is when we look at one part or one time period of business operations to make a decision. This can be a pricing decision, tax planning, etc. Although this is important, we have the biggest impact on our business when we focus on daily review. Look at the profit and loss and balance sheet every day. Compare balance sheet and profit and loss to last year’s numbers as well as last month.
Finally, go further to investigate why the numbers are what they are. Those numbers represent human behavior. Sounds silly, but that is exactly what your profit and loss is, the culmination of the activities of you and your employees. If we can dissect the numbers, we will know how to change the human behavior. This is how we bring success to businesses that are struggling.
This bears repeating since many businesses never achieve their potential because they don’t use the numbers to drive more success in their business. My confidence that this makes a difference comes from years of working with businesses that I have seen increase their net income drastically. The formula is so simple, yet very few businesses ever figure it out. The bottom line is that you have control over making your business more successful. Choosing a proper bookkeeper can create vision, opportunity, and financial clarity.