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Category Archives: financial reporting

An Analytical Approach to Scaling Growth

An Analytical Approach to Scaling Growth

When you scale you need to have a more analytical approach of targeting and segmentation, but in the beginning, it’s more much qualitative. (Pavel Malos 6/11/18, uxdesign.cc)

Chief Executive Officers, Board Members, and Investors have a fiscal responsibility to ensure an organization can handle planned growth.  For-profit business leaders must back up the strategy with the right level of working capital and financial infrastructure.  Nonprofit leaders must make certain they have the right financial and fundraising data to analyze and plan effectively.

 

QuickBooks and other simple financial programs have elevated the confidence of professionals, not trained in accounting, past their competence.  These systems allow you to process the basic information easily; however, the non-accountant may not have applied the required strategic thought process to the design of the infrastructure that a trained and experienced financial strategist would apply. Some entities can be run effectively in QuickBooks, and the financial data can be analyzed if the infrastructure is set up properly in the beginning.

 

All organizations need to have financial information, in proper segments in the General Ledger and make sure there are proper period end procedures.  Lack of proper information can lead to performing services or selling product at a loss, non-compliant reporting and a lack of proper cash flow.  All of these issues can lead to an untimely end to any organization, for-profit or nonprofit.  We have all heard of employees showing up for work one day to find the doors locked and an abrupt end to their job and paycheck.  Sometimes these employees learn their employers have not remitted federal income taxes, deducted from their paychecks, to the IRS and they have to pay the taxes again.  Leaders of organizations should listen to their financial leaders when they request upgraded systems and more people to account properly for the organization’s financial data.

 

Leaders who make it a priority to set up, manage and monitor metrics have thought through configuring their reporting infrastructure. Leaders without such foresight run through their day-to-day life worrying about how to make payroll and pay bills, with little to no awareness about which decisions are working and which are not working to scale growth to new levels.

 

Barker Associates has the unique ability to work with all sizes of organizations and building infrastructure that matters.  Contact us today!
Mindy Barker, Founder & CPA | Jacksonville, FL 32256
(904) 394-2913 or (904) 728-2920 | CFO@MindyBarkerAssociates.com

Be “The Man” – Respect the Need for Financial Infrastructure.

During an especially stressful day, I decided a Whole Foods Green smoothie was just the thing to help relieve the cortisol I felt building in my system.  Their green smoothie is one of my favorite drinks, I can just feel the goodness going down. I ran into Whole Foods, straight to the juice/smoothie counter.  There was no one there and I eventually noted a sign that said the juice bar had been moved to the coffee bar – on the other side of the store.  I hiked all the way across the store, walked up to the coffee bar and ordered my smoothie. The barista who was working the counter had the unfortunate duty to tell me they no longer had smoothies – a self-serve juice bar – but no more smoothies.

Be The Man. Respect the need for financial infrastructure

By now my cortisol level was probably off the charts, as I walked away, announcing to shoppers on the juice bar aisle, “Well it looks like Whole Foods has gone to ‘The Man.’ How could Amazon and Jeff Bezos determine that their delicious smoothies had to go away.  That was one of my favorite things at Whole Foods!”

Who is “The Man”?

For those who grew up in the post-‘60’s era, “The Man” is slang, often derogatory, that may refer to the government or other authority in a position of power. Resisting The Man’s way of doing things was (probably still is) considered being a nonconformist. When I hear people say, “I am not working for The Man,” my interpretation is that they all want to be entrepreneurs, not stuck behind a desk complying with rules.

Later that day, when I had calmed down a bit, I realized that my annual expenditure of 3-4 Whole Food green smoothies probably did not warrant keeping smoothies in the product offering; the personnel required to man the bar and maintain the low customer demand was probably not cost effective.

Wait a minute!  Does that make me the smoothie crusher?  Putting on my Financial Strategist hat, I thought about the clients I help analyze revenue and costs to determine if they are making money on product lines; and if not, help them strategically determine what changes can help make the business more profitable and increase the enterprise value.

Strategic Decisions

If you are making decisions about finances based on very short-term needs, like making payroll or paying bills without the right financial information and analysis, you could have unprofitable green smoothies throughout your organization and not be aware of it. Continuing to offer green smoothies at a loss is a strategic decision you should make based on facts. At times it is warranted.

Business professionals in both the corporate and non-profit world often move out of that world to get away from “The Man.” They feel worn out from the suppression an employee feels trying to make a difference in the face of bureaucracy.  They have the desire to impact society by providing great products and services for all.  Their exuberance can lead to unprofitable (or unsustainable) business products, programs, and lines of business that persist for years if the leader does not respect the need for quality financial information and commit the infrastructure to get it.  And to take that one step further, leaders must also invest the time to analyze the information and make strategic decisions.

Respect the Need for Financial Infrastructure

I have gotten over the loss of my green smoothie and will persevere through the change. What about you? Could you be a leader with unprofitable green smoothies, leading your organization to a negative cash flow abyss that will be difficult to dig out of?  Respect the need for financial infrastructure and take the time to analyze it.

Barker Associates can facilitate a review of your product lines, current financial infrastructure and processes to determine the next steps for your organization.  Be “The Man” in the positive sense, by using timely, reliable financial information to think strategically and move your organization forward.

How to Gain Financial Clarity from Month End Close

As a business owner, do you have timely information to run your business? Or do you feel like you are in jail, lacking the freedom to run your business with financial clarity? I admit it – we accountants can be very black and white. Some accountants feel the need to turn the monFinancialFreedomth end close process to a detail-mining analysis of minutia, requiring detail that is not relevant to the big picture and decision-making.  The time and expense involved with a long, drawn-out month end close is expensive, with the most expensive part being the opportunity cost of management not having the proper information to make the right decisions to run the business. I can show you that the month end close process should take no more than 5 days.  Each month a post-close meeting with all involved in the process can help identify areas to reengineer that will accomplish a 5-day time line.  Each Journal Entry should be analyzed to determine if it can be made earlier in the process.  In most cases, there are ways to accomplish this. Mindy Barker & Associates can assist with analyzing the process and helping you achieve a 5-day month end close.