As 31 March rolls around yet again, it’s a good time to review financially what went well last year in your business and where there may be room for improvement.

Below you’ll find a ‘checklist’ of sorts that you can go through as you reflect on your financial situation:

• What are the key performance indicators (KPI’s) in your business?
• How much cash do you have on hand?
• How much money is owed to you?
• How much money do you owe your suppliers?
• Can you pay your bills on time?
• Are there any costs that you’re incurring that aren’t providing adequate benefit?
• Can you streamline your business to generate more on the bottom line / profit?
• How did you measure up to your budget? (Did you even make a budget?!)
• Looking at your year-to-date financials, are they ‘fair to middling’, satisfactory or OMG! – how much tax will I have to pay (meaning you made a heap of money)?

To have a successful business you need to be monitoring your financial picture on a regular basis.  Costs change, your customers’ circumstances change, markets change, and we all know interest rates change. Each of those things can have a big impact on your bottom line.

And of course, stepping away from the detail and looking at your overall business, here are a few things to consider:

• determine what you want your business to look like in 12 months’ time so that it can direct your planning
• identify your biggest challenge and potential ways you can solve it in the coming year
• brainstorm ways to increase your client base (and profit) to increase the value of your business
• think outside the square. Just recently, I met another self-employed accountant – similar age, similar staff numbers – who had a completely different business model to my own, but was achieving similar results
• think about where you are in your business life cycle, as your needs will be different and you should be approaching your business and financial strategy accordingly:
  • Start-up phase
  • Middle age
  • Approaching retirement

Here are a couple of final thoughts. ‘Debt’ is not necessarily a bad word: a loan can start a business, rescue a business, or get a business to the next level. Theres a reason why banks need to see your budget before they lend to you, so be sure you know your numbers!

Your business relies on you, so invest in yourself as the most valuable asset in your business. What better investment is there than YOU, who you can trust and control.

I hope this has given you some food for thought as we start another financial year. And remember, for professional guidance, do speak to your accountant or financial advisor.

To find out more about how Raelene takes care of her clients, you can visit her website: https://www.reesaccounting.co.nz/