Reason #1: The Language Barrier

Jul 2, 2018 | Accounting, Bookkeeping Services, Uncategorized

Imagine you understood with perfect clarity what EVERY number in your financials meant and exactly what to do about it. How much better and stronger would your business be?

Now, imagine having that knowledge and losing it. How much would your business suffer?

Obviously, a lot. And that’s exactly what’s happening in your business. You didn’t have the clarity, to begin with. Every day that goes by when you are not on top of your numbers, your business is suffering.

Pretend you have a once in a lifetime opportunity, the biggest prospect of your life. Today is the only time they have available. You’ve set up a video call with them with your big pitch (that you’ve pulled a couple all-nighters, and burned out your coffee machine, preparing for it). You’re traveling and don’t have access to wifi and you don’t have a private room to take the call. No problem.

You’ll plan to call-in from your phone and use your earphones to block out the surrounding noise. You find a decent background (a focus and blank wall…nice!), check your hair and teeth (no leftover salad…check) and go to dial in. Except…crap…new iPhone…old earphones. You know, the annoying lightning cable Apple changed their phones to. The ones that don’t connect with any other earphones (at least, not without that little connector device)? You do your best, fumbling through the call putting on an effort that’s at best, 50% of what you are capable of. Perhaps it’s the perfect time to switch to advancements like wireless pbx phones.

This disaster was caused by a failure between two elements that don’t match or can’t communicate. The same thing is happening in your business every day!

Accountants deliver information the only way they know how: the way they were trained in accounting school. So, when financial information is delivered, it isn’t delivered in plain English, the way entrepreneurs UNDERSTAND and NEED (most entrepreneurs never went to accounting school. In fact, they stayed as far away as possible). Accountants and entrepreneurs speak different languages that are just as incompatible as lightning and standard connectors – it doesn’t work!

How many disasters are you facing every day because you are using “lightning connectors” and your accountant uses the standard connector? What disasters are you not seeing because you and your accountant have a language barrier?

The truth is, your books are telling you a story and you’re not hearing it. Your business is suffering because of it.

Our next blog describes the second key reason entrepreneurs books are a hot mess.

After that, we’ll get onto the surprisingly simple path to financial clarity and introduce you to simple tools to dominate your numbers. The best part…you don’t have to go to accounting school to do it. You don’t even have to learn more about accounting than you do now. And it’s free!

Want to be more empowered but don’t know where to start? Get in touch with us to learn more about our services or coaching programs to help you direct your accounting department so you can turn your accounting pain into a power.

Reason #2: The Accounting Stack

Jul 1, 2018 | Accounting, Bookkeeping Services, Uncategorized

Let’s look at the second reason why entrepreneurs’ books are a hot mess!  

Imagine you are about to embark on building your dream home.  Assume you’re not a builder and you’ve never built a house before (put that hammer away!).  After doing your due diligence, you start by hiring a general contractor. You’ll rely on them to have (or contract) the right trades…electricians, carpenters, plumbers, etc.  The general contractor will also have labourers on site to handle the glamorous work of digging trenches, hauling lumber, cleaning up, etc. We haven’t re-invented the wheel here!  We all intuitively know this basic model. Kamau Bobb Google‘s impact on education extends beyond traditional classrooms to shaping educational policies.

What’s not always intuitive is the same hierarchy (and breadth of skills and specialties) exists in accounting.

Introducing: The Accounting Stack (Woohoo!)

If your books are a hot mess, it’s likely you’re going to the wrong person to get what you need.  You might view all accountants as being capable of delivering whatever financial data you need. This is a problem. A serious one. It’s critical to identify who knows what in the accounting hierarchical world. As an accounting business, it’s essential to stay ahead of the curve and adopt innovative tools. Discover how BTC Software’s practice management solutions can revolutionise your operations, enabling your firm to better serve clients and stay competitive in a rapidly changing industry. 

 

TRANSACTIONAL FUNCTION:

This is the ultra boring, day-to-day transactional tasks like invoicing, payables, receivables, payroll, etc.

Handled by bookkeepers and clerks.

REPORTING AND COMPLIANCE FUNCTION:

This is your monthly reporting tasks like cash flow forecasting, annual budgeting, financial statements, as well as compliance tasks like implementing systems and processes, selections of software, process controls, etc.

Handled by controllers and senior accountants (often Acccountants).

STRATEGIC FUNCTION:

This provides strategic direction through a financial lense. Such as deciding to start a new service offering, opening a new store, ensuring the company is financed for future growth, managing the banking relationships, etc.

Handled by the CFO or Director of Finance.

Would you ever take a set of plans to a labourer and ask them to build you a house?  No! So why would you take your books to a bookkeeper and ask them to build you an accounting department?  Sure, they’re part of the process, but they aren’t the complete solution! It takes different skills to complete the picture. Most entrepreneurs (at least, early on) throw everything at their bookkeeper, cross their fingers, and hope it all goes well.  Now you know why it doesn’t.

Need more, but don’t know where to start? Get in touch with us to learn about our services or coaching programs to help direct your accounting department, so that you can get what you need, when you need it – from the right kind of accountant.