How To Get More Cash & Profit Out Of Your Small Business Accountant

INTRODUCTION:

As technology continues to affect almost all businesses, including accountants, there is no doubt that small business owners want more than just tax and a set of financial statements that sit in a drawer and sometimes get sent to their bank managers.

To stay alive in business will usually mean that you need to grow or get left behind. To get this business growth will mean 2 key ingredients - profit and cash flow.

Just exactly what is your small business accountant Sydney doing to assist you with these 2 factors? Here are 5 tips below to make sure you're getting the most out of your hard earned dollars when it comes to getting dynamic and money for value accounting advice.

Figure 1: Your accountant should have the tools to help you build  your business vision.

1. Ask for help in finding what you really want

It's one thing to want profit and cash flow. However to maximise the chances in getting exactly what you want, ask your accountant to help you establish exactly what this is. Work out what you want your business to look like in terms of profit and bank balance over a 12 month to 5 year period. You will need help with tax as you will usually look to find out what you want to physically make in terms of after tax dollars.

What are your lifestyle expectations? What will your business need to do to help you achieve these goals? Do you expect to sell and of so do you know your small business valuation now what a business valuer might put it at if you achieve your vision?

Have you ever noticed that a jigsaw puzzle comes with a picture on the cover? What you find then is when completing the jigsaw puzzle you will constantly refer back to this picture.

It's no different in business! Have a clear picture of this business and then you can constantly refer back to it when bringing it to life just like that puzzle.

2. plan the numbers using the latest budgeting techniques

Once you have worked out your business picture then it's time to do the numbers to let you hit the goals. Using cash flow forecasts is just one of the budgeting tools you should be using. The best accountants these days are using highly sophisticated models called 3 way budgets which will make it easier for you to plan, create and monitor when trying to achieve your targets and your business by design (not business by default!). The 3 way budget has a profit and loss budget, a cash flow forecast and a balance sheet budget. All of these should reconcile with each other and explain to you what will happen with your cash flow if you happen to hit your targets.

Small business accountants Sydney using just profit and loss budgets these days is old school and you deserve the best and I can honestly say that clients that use the 3 way model have a much higher success rate than those who don't.

Figure 2: Time to get down to business! 3 way modelling is the way to go to help plan your success!

3. check your business growth strategy

You now have the jigsaw picture created and the numbers ('pieces') that will help your enterprise to go from theory to reality. However, you naturally need to have a business plan to ensure your growth strategy can be reached.

How many leads do you get a month? How many of these convert to customers? How much do your customers spend and how often each year?

You need to understand these numbers and then you can tweak them to help you work out what needs to be done and what strategies need to be in place. This is called the Growth Equation.

Have your Sydney accountants helped you with this? If not, be sure to ask them for guidance.

4. consider tax minimisation strategies

The traditional small business accountant is usually very good at tax and the modern one also needs to be. Getting tax planning done each year will put more cash in your bank so it's wise to seek help with this.

Do you do tax planning at least once a year (usually in April/May)?

5. be accountable! Check in at least quarterly to stay on track

I think it's fair to say that if you have gone through the above process, it's important that you have a system to keep you on track. Business coaching is something modern small business accountants offer these days even if it's disguised as quarterly meetings to see where your business is compared to its plans.

It's very easy to get too busy and then say you didn't have time! This is not acceptable and your accountants should tell you so if you're not doing your end of the bargain to create success. As the saying goes "80% of winning is beginning."

Figure 3: Work together and do what you say you will do when you say you are going to do it!

CONCLUSION:

In a perfect world, all accountants should be checking the above 5 things with you regularly so you can achieve your dreams. The proactive ones are already doing this. Don't be afraid to ask if you're not getting these services.

Receive these offerings and I guarantee you will love your accountant more than you ever have!