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The Financial Mentor with David Boyar: Lifting the lid on business

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How to achieve clarity and control through your financial decisions

by David Boyar |

Accounting, Visibility

|
No Comments
February 26 , 2019

 

Instinct definitely has a place and a role in business and, ultimately, all decisions will come down to something that makes you feel comfortable. It speaks to the quality of your judgement.

Even in a small business, you want an element of control and diligence because you know that all the stakeholders will then be able to deal with the decision that they are making. When you are small, it’s easy to get access to three or four critical pieces of information that you might need to make your decision.

However, it’s difficult to have this kind of agile thinking with a larger business with more employees. The question is, how do you know that you’ve gone from that moment where you are okay to manage with your gut to where you need to start getting control and having full visibility? 

Your Growing Business Becomes Financially Complex

There’s momentum that happens in a business where you build and grow, and opportunities start falling in your lap. You just want to jump on these opportunities. If ever you see this momentum building, stop for a moment and ask yourself: “Can I actually deliver this?”

Depending on the business you have, but generally around the million dollar turnover mark, you start getting to the point where it’s harder to manage staff, eyeball them and find out exactly what’s going on.

You need to know what’s happening in the business. You need to get financial clarity and control and have the systems and processes in place to achieve that.

A Virtual CFO can Offer Financial Visibility

Some people are hyper aware of what their costs are. They see what’s coming by their desks. You start to lose that as you get bigger. You’ve got more and more invoices and there are different things going on.

What people often get surprised by at around this point is what we call statutory cost. The typical business owner has no real control of statutory costs. These costs are dismissed for the bookkeeper or accountant.

Statutory costs are your GST payments, your superannuation, extra insurance that you might need, or income tax instalments. These are big ones that everybody knows will hit them at one point in time but that very few business owners plan for.

Without financial processes and systems, without visibility and control, relying on gut feel alone leaves you open to unexpected crises due to these statutory costs.

A Virtual CFO can help you achieve financial control and visibility. Through skilled cash flow management, bookkeeping, accounting, business intelligence systems, performance management reporting and strategic advice, you can get the expert guidance and advice you need to make smarter business decisions. 

Learn more about how our Melbourne Virtual CFO team can optimise your business here.

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The Financial Mentor with David Boyar: Lifting the lid on business