If you aren’t asking yourself these 5 questions, you are doing yourself and your business a disservice when it comes to your current accounting function!
Which of your greatest expenses provides the least amount of return?
For example, if you are a distributor, your greatest expense is the product you are distributing, and the second greatest is likely wages. After that, is that advertising? Are you able to measure the returns on that expense to see if the efforts should be redirected?
What are your goals for growth?
If you are not-for-profit, you need to identify specific sources of revenue and develop a plan to pursue them whether its contract funding or fundraising events. If you don’t have a plan, it will not happen.
What services should you no longer pursue and why?
This is a tough question for most executives. It is usually difficult to answer because they don’t have the information ready and available that is needed to make the decision. There are places the company should “stay” – for instance, a product line that might be breaking even on the net income side, however, it is the “icon” of the brand and all others include this product, so it needs to remain. Diving deeper will help you understand how to maximize the benefit of that product that must remain. For a Not-for-profit, it’s assessing the social impact of your program against its cost.
What was THIS cost for?
You would be amazed at how many times NO ONE knows the answer to that question. If the numbers are small, and especially when they are big, there is no comprehensive oversight. How can you possibly cut costs or track spending when you don’t know where the money is going?
Are you given continuously little information and expected to make big decisions?
Most business owners and directors will tell you they have the necessary information to make big decisions, but when you spend the time to go over their existing reports with them you will find they know very little about the information they are reviewing, and more importantly, they don’t know what to do with it. I ask questions that are specific to what they are going to monitor daily. What plans do they have to grow or change? What is going on with the industry or technology that might significantly impact the future of the organization? These are thoughts that the management team is having, but not putting together collectively to inspire strategy for the organization.
The Result Of Working Outside Of The System
If you are having trouble answering one or more of these critical questions, it may be time to consider a change in your accounting function. Contact us today at www.wvcrubixcloud.com/get-started to get your complimentary accounting review.