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As we come out of arguably the toughest recession that the country has seen for many years, there are many lessons businesses who have successfully survived have learned.
One of the main lessons for some businesses is that the approach traditionally adopted by them of relying on their annual accounts and using the bank balance to measure their performance is no longer sufficient.
Quality management information is absolutely vital to enable business owners to make well informed and timely decisions to ensure they stay ahead of the competition, maximise their profits and manage their cash flow. At a basic level, an up to date monthly profit and loss account and balance sheet will provide feedback on the effect of decisions being made by a business. Identifying key performance indicators (KPIs) and reporting on these on a routine monthly basis can help a business focus on key issues and help drive forward performance. KPIs can also be used to incentivise staff and help change attitudes and behaviours within the business.
In addition, banks and other lenders have much more confidence in the business if management accounts are regularly prepared – it shows the business is in control of managing its finances and can help positively in securing successful lending decisions.
Springfords already provide an increasing number of our clients with monthly management accounts tailored to their needs on a fully outsourced service basis. Not only do we prepare the figures, we then sit down with our clients and help them to interpret what the numbers are telling them and what actions they need to take. Plus we have worked alongside our clients' internal accounts staff to help design more detailed and relevant management reports, as well as providing training on the preparation and interpretation of these.
For further information about our tailored management accounts solution contact our partner Carol Wright at firstname.lastname@example.org