Take Stock of Where You Are Mid-Year
It’s hard to believe we’re halfway through 2019! As busy professionals, it’s easy to get caught up in the day-to-day needs of your business or not-for-profit. However, it’s a great time to perform a mid-year check-up of your accounting operations, to ensure they’re supporting the overall success of your organization.
Consider your answers to the following important accounting questions so that you can identify any trouble spots early and make the necessary mid-course corrections. This will help you avoid costly fixes over the long-run and make sure you’re still on the right path to success:
1. Are Your Bookkeeping Processes Up to Date?
If you or your staff are getting lost in mounds of paperwork or spending too much time on manual bookkeeping entries, and/or you’re still paying bills using paper checks, it’s likely that your bookkeeping and accounting processes are outdated and costing you valuable time and money. Invest the time to bring your back-office operations up to date through more automated and integrated systems. For more information, read my article.
2. Are You Closing the Books on a Regular and Timely Basis?
The main objective of the closing process is to ensure the completeness and accuracy of the financial reports you need to run your business. The process includes properly recording all financial activity for the period and reconciling all accounts. Regardless of the size of your organization, it’s important to close your books on a regular basis, preferably monthly, so that you have an accurate and complete set of financial statements that reflect how you are doing.
If you’re uncertain about how to close the books, or you have a hard time closing them in a timely manner, it may be time to have a professional accountant provide guidance on how to build standard operating procedures (SOPs) to close the books effectively and efficiently.
3. Do You Have a Good Understanding of Your Financial Position?
Even if you have someone else do your bookkeeping and generate financial statements, you need to understand your business or not-for-profit’s financial status and review reports regularly so that you can make informed business decisions. If you have a hard time understanding what your statements are telling you about the financial condition, it’s time to get help. Take the time to walk through your financial statements with your accountant and don’t be afraid to ask questions.
4. Is Your Accounting System Working for You?
As part of the check-up, assess how well your accounting system is meeting your needs. If you’re experiencing rapid growth, make sure the current system is scalable and can grow with you. If it’s currently difficult to access real-time, accurate information about your financial activity in a secure and user-friendly way, it may be time to upgrade your current system. Click here for more info on the advantages of moving to QuickBooks Online.
5. Does Your Current Staffing Meet Your Accounting Needs?
If you find yourself spending too much time in the weeds of your day-to-day back office operations and it’s taking you away from what matters most to your organization, then it’s time to delegate certain tasks to others. During your mid-year check up, assess your staffing structure and determine whether it’s effectively meeting your growing needs. It may be time to hire outside experts to handle areas outside your core competencies. If you’re considering outsourcing your accounting, read my article on the benefits of outsourcing.
Investing the time to step back and take stock of your bookkeeping and accounting operations is a prudent best practice. Your mid-year check-up will help you assess how you’re doing and refine your practices in a cost-effective manner.
If you have questions and/or would like help in any of the above areas, please reach out to me. I’ll be happy to talk with you about ways to improve your business or not-for-profit. Orin Schepps, Founder and CEO @consultanceaccounting https://www.consultancellc.com