Accounts driving you mad? Here’s the first taster from our E-book ‘The 27 Common Financial & Marketing Mistakes That are Costing Owner-Managed Businesses £Millions Each Year’.

We know what you’re thinking…typical accountants banging on about the boring stuff!

Well, here are three facts that you may not be aware of…

1. Failing to maintain proper records is, in many cases, illegal and can lead to personal prosecution and potentially incurring personal liabilities. 2.  Failing to maintain proper records is recognised as one of the main causes of business failure in the UK. 3. Detailed available management information will help identify where monies are being lost or opportunities missed and hence how profitability can be improved.

Imagine taking your car on a long journey,  without any dashboard information being available to you. You don’t know what speed you’re doing, whether any faults are developing or when you are going to run out of fuel.

You may think that you have enough driving experience to be able to gauge these things in your head but at some point you are going to get it wrong and there is nothing to tell you otherwise. You are heading for trouble.

Running your business without good financial information is exactly the same. You may think that things are okay but you have no meaningful record of what you’ve actually done and, more importantly, what’s coming up.

“I don’t have the time” is the most common excuse we hear, followed by “I’m not an accountant, I don’t know how”. In reality they are saying “I don’t think that it’s important and I can’t be bothered to sort it out”. When you consider that the alternative is prosecution, missed profits or business failure then any excuse seems pretty weak.

It’s all well and good having an accounting system in place but if it’s not kept properly set up with key reports, or up-to-date then you still can’t get hold of accurate information on your business as quickly as you need to.

We come across businesses which have invested in an accounting system such as Sage, for example, but use it for little more than doing their VAT returns. A wasted investment and opportunity.

If you don’t have up-to-date, accurate accounting records then:

1. You have no reliable information to assist you with your everyday business decisions; 2. You pay unnecessary fees to your accountant; 3. You cannot get summarised key information and feedback to your team to improve profitability; 4. You cannot supply information to your bank, mortgage lender, etc., and therefore can’t get financial help when you need it.

In other words… You are not maximising profitability.

Examples of some reports you should be using to run your business and improve profitability: http://s4buk.wordpress.com/2013/02/20/examples-of-reports/ PLEASE NOTE: We know you have many priorities to address when running your business but we can help you fix this one easily… 1. Get one of the many cost-effective ‘off the shelf’ accounting software solutions available – we can help you select the right one. 2. Get some training, for you and/or a staff member. Again, we can help you with this. 3. Set up a regular reporting system, giving you the key information for running your business and making the right decisions.  We can talk you through what is best. The solution is simple. A little training and guidance from us. It will pay for itself many times over. Alternatively, we can come out on a regular basis and do it for you. Give us a call and we’ll talk to you about the best option.

The S4B Team