Why Funancial SMART?
We are all busy! ...and even more, we are all overwhelmed by the range of information which we try to deal with on a daily basis!
Making sense of the financial information around your business in conjunction with being able to make the right business decisions are typically in direct conflict. If you are a business owner or manager, you surely have experienced the following questions:
If you ever experienced any of the above, then we can help.
Typical company leader journey
Our team has years of experience in helping companies understand operational efficiencies while working with CEOs and managers globally.
In a typical startup journey:
- Founder starts a company – young, naïve and confident.
- Like most entrepreneurs starting their own business, they are passionate about what they had to offer and were very sure that their idea would work.
- They start operating thinking that they are doing well when – less than a year later – the real world comes crashing in, as they are forced to get to grips with a whole host of financial terms – bookkeeping, VAT returns, PAYE returns, Profit & Loss reports (also known as Income Statements), Balance Sheets.
- The list goes on.
- They decide that they cannot afford to waste time on all this financial reporting stuff.
- The logical choice, of course, is to hire an accountant with the hope that they will now be able to concentrate their time and effort on making money to cover expenses and keep their company afloat.
- Over time, the reports of their accountant are either not meaningful enough or timely enough to enable them to understand how they are really doing, or how to make the required strategic decisions needed in time.
- Regulatory reporting requirements overtake strategic financial intelligence thereby triggering a spiral of confusion and uncertainty.
These outcomes, unfortunately, are not bound only to startups!
We repeatedly see the pain of business leaders and founders as they go through the motions of trying to understand financial concepts to understand what their CFO, Accountant or Auditor is telling them.
Even more, even when they are managing to gain ground, the speed of access to the latest financial data is either not timely or not in a format which enables them to make the necessary relevant decisions.
Financial management is a fundamental part of running a business.
If you don’t keep an eye on the finances, things can go horribly wrong. It’s common knowledge that most businesses fail within the first 3 years due to a lack of cash – in other words, inadequate financial management.
The issue is, it’s often difficult to see how these reports are even vaguely useful when it comes to making financial decisions. In our opinion, these reports are really useful to tax collectors and anti-money laundering agencies. That is why these reports are only audited on an annual basis. They help the government, not the business owner.
While necessary, this means the business owner is still lacking the tools and information needed to run their business. From a business leader's perspective, even if you draw a Profit and Loss or Balance sheet statement on a monthly basis, these reports do not help you manage your cash flow, or make the decisions you need to manage the profitability of your product lines.
*If you have to wait 30 days (and in many cases much more...) before potential problems can be identified, doesn't this put your business at risk?
*Isn't it a lower risk to business if the owner/leader is alerted of potential issues on a daily or weekly basis? This is where Funancial SMART comes into play.
What we did about it
We have taken what we have learned over the years and created something that we hope you will find useful.
Funancial SMART uses data retrieved directly from your accounting package, to identify the necessary information you need to answer fundamental questions necessary to ensure the sustainability and effective running of your business.
Our target is to equip you with the most important financial data you need in a format that is easy to read and help you answer some basic, FUNdamental questions (pun intended).
*Funancial SMART interpretation of the data in the accounting package depends on the accuracy, and update frequency of information within the same package. If your bookkeeper does not update Xero on a daily or weekly basis, the usefulness of Funancial SMART will be severely limited! If you need us to, we can help with bookkeeping so reach out to us via our Help Centre.