Week-by-week accounting VITAL for success
Business Advisory Services Update
Accountants and bookkeepers are aware that the old concept of producing an annual set of accounts and income tax return is not enough data for a business to survive.
The ‘52-WEEK BUSINESS ENHANCEMENT SYSTEM’ ensures that on every working day, there is data being produced relative to the business’s financial performance.
It all starts with the Daily Reports which could include:
Sales total
Average sale
Sales per customer
Comparison to the previous day and same day in the previous week
Business managers use KPIs to help implement strategies as soon as possible.
Weekly Performance Analysis: This concept is widely adopted by larger businesses. But at this stage, many SMEs do not receive a performance analysis at the end of each week.
The weekly performance and profitability report for each individual business operation summarises important performance data. The weekly profit is an estimate which will give the manager a very good real-time indication of the result of the week’s performance.
The report gives managers great real-time information that is close enough to the actual event, which will allow them to recall significant issues that may have contributed to a better or poorer performance than what was expected. Furthermore, they can make real-time changes to either benefit from an ‘accidental improvement’ in the previous week or they can implement strategies to offset a problem.
Monthly Financial Accounts: The ’52-week business enhancement system’ is designed to enable the preparation of monthly profit and loss accounts for each business activity together with the balance sheet.
A comparison of actual performance to budget should also be prepared.
When the system is implemented, there should not be significant variations between what is revealed in the weekly performance report and the monthly financial accounts. This will enhance the reputation of the weekly performance report and will encourage managers to have confidence in the weekly data.
The balance sheet should also be evaluated relating to KPIs for debtors, inventory, creditors and bank balances.
A monthly financial performance report should then be prepared by the accountant/bookkeeper for submission to the Leadership Team.
ESS BIZTOOLS has developed a wide range of resources to assist Accountants and Bookkeepers to implement these systems.
We will present a complimentary webinar, highlighting one of these packages, introducing the ‘ADVISORY INTRO’ Product Package. This informative webinar will be held on Tuesday 19 March at 11am AEST. CLICK HERE to register.
