What Can You Learn From Those Boring Financial Numbers?
They’re not just numbers
Let’s face it, financial numbers are boring. If your business is all about fixing cars, creating art, or making clients beautiful in your salon, you have more exciting things to ponder. The thing about all those boring financial numbers is that they’re critical to doing everything else you want to do.
Your financial data documents your business and its relationship to money. You can always outsource your bookkeeping (we’re really good with numbers) but when it’s time to apply for a loan, or pay your taxes, or pay your employees, you need to understand what those boring financial numbers are trying to tell you.
Ask the numbers a money question
If you wake up in the middle of the night wondering how your business is doing, you need answers. Unfortunately, that waking-in-the-middle-of-the-night dynamic happens quite frequently with small business owners. When it happens to you, you can answer these and other questions when you have easy access to those boring financial numbers.
Do I have enough products for the upcoming holiday season?
There’s really no way to precisely predict what you might sell this year. You can get a feel for it by looking at your holiday sales numbers from previous years. You can find those on your Cash Flow Statement. It tracks money coming in (sales) and out (expenses) of your business. These numbers provide a record that helps you determine your potential for sales this year based on a prior year’s performance.
You can check your Balance Statement to see if you have the inventory you need to meet your predicted demand. A balance statement shows your current assets and includes your inventory. The Small Business Administration calls it “…the foundation of managing your finances…”
Is my business making money?
All those numbers on your Income Statement show you how much money you’re making. It tracks your total income from selling products and services over a specified period. It also shows the cost of the goods and services sold. When you deduct your costs from your sales you’ll have the answer to your question.
Can I meet tomorrow’s payroll?
That’s a scary night-before-payday question. Although it’s something you should probably address before 3:00 a.m. on the day of…, your Balance Statement shows your cash on hand. It tells you if you have enough to pay your employees, your suppliers, your rent, or whatever else is due.
Did my customer pay that big invoice I sent?
The numbers in your Accounts Receivables and Accounts Receivables Aging Reports help you track customer payments and payment habits. It has the details you need when you’re concerned about a customer’s outstanding balance.
Outsource those boring numbers
Those boring financial numbers have the answer to all your must-know business questions. If you don’t want to think about them every day, bookkeeping software does a great job of doing it for you. You’d still need a dedicated employee to set up your chart of accounts, input your data, update your software, sync your bank records, and perform a long list of critical tasks. That’s where we come in.
At Goode Bookkeeping and Consulting we don’t think numbers are boring at all. In fact, we love financial numbers. That’s why we’re so good at what we do.
We keep track of all your financial data. When you need to see what’s going on with your business finances, we produce an updated Cash Flow Statement, an Income Statement, or any other report you need.
For more information about our professional services, call us at (860) 968-2345 or complete our consultation form.