Invest in your finance function. Why? More money. A better bottom line. A stronger, more valuable business. Your business, your castle. If you don’t, your castle is made of sand. And as the Jimi Hendrix song goes
“And so castles made of sand fall in the sea eventually”
Let’s look at
- Growing Business
- Cloud Accounting
- Is one better than a team?
- Trusted Partner
- Bottom Line
Growing Business
You have a growing business. More customers, more staff, more sales, and more profit. A growing business doesn’t always mean more profit. That’s the goal, of course. Why would you work harder and earn less money? You intend to make more money, but are you keeping a close eye on your costs and margins?
Like 99% of people, you want to do things right and keep Revenue paid and away from your door. You or your other half can no longer do the payroll and the VAT returns. Romance is dead when you’re doing a VAT return at 10 o’clock at night! You hire a bookkeeper or a finance person. They’ll sort all that for you, so you can look after your customers and keep growing. Cash is king. Invoicing on time and ensuring strong payment terms. And a follow-up system of getting cash in from those late payers.
You are spinning lots of plates. Like Steven Staunton said, you are the gaffer, so the buck stops with you. To take control of this, you need help. But what is the right type of help for you? Is it a bookkeeper, a finance person, or what about a team? An outsourced finance department. How would that work?
Cloud Accounting
I spoke about this before in the modern versus the traditional accountant. Cloud accounting gives you same time access to your sales numbers, your invoicing, and your debtors. You can access it on your phone, as can your accountant, all at the same time. We use Xero because we think it’s the best for our clients. It has some drawbacks, but the positives far outweigh the negatives.
This isn’t a party-political broadcast for Xero. It’s just our chosen candidate. What you can get from Xero includes
- Super Fast invoicing
- Bank Feeds – import your bank statements into the software from AIB, BOI, PTSB, and Revolut Business
- Easy import of purchase invoices. Want a breakdown of repair costs? All the invoices are there that make up that cost.
- Match payments with invoices issued
- Make paying you easier with links to Stripe
- Easy review of debtors – who is paying late, so you can chase them
- Quicker and easier collaboration with your accountant
Imagine no more half-hour phone calls with your bank looking for bank statements. But a word of warning. You don’t get Xero, and everything is suddenly magical. It takes time to get this right. Time and money to invest in your finance function.
DEXT
Dext is a little piece of accounting software that I love. Think of an old-type office. Paper everywhere. Lever arch files stuffed full of paper. And office shelves stuffed full of lever arch files. Now think zero paper. No storage, no files, and no wasted space. It’s all in the cloud. That’s what Dext gives you.
Take a picture of that diesel receipt with your app on the phone. It goes to Dext. Your bookkeeper reviews it and sends it to Xero. The rule is set up in Dext, so it goes to Motor expenses. Plus, the VAT rate is right, so you’ll get that back. Imagine all your invoices are like that. You see them in your inbox for your review, but they go to Dext at the same time.
All your invoices are stored on the cloud and imported into your Xero. This system is absolutely brilliant when Revenue come calling. You are in a VAT refund position, but Revenue won’t give you your money. They want your top 10 sales and purchase invoices for the VAT period. This is available at the touch of a button. Some sorting and then downloading. It takes a few minutes and not a few hours. Your time isn’t wasted, and you keep the focus on the business.
Is one better than a team?
No. One isn’t better than a team. Last Saturday night, in the first half, it was like one Caoimhin Kelleher versus the Hungarian team. The Ireland one was two-nil down at half-time. It’s food for thought. Do I need to hire a bookkeeper or a finance person now that I am growing? Or what if my bookkeeper or finance person is retiring or leaving? You have a need, and it’s a difficult situation to find someone suitable and then to keep them. Plus, you are adding another body to the payroll.
Why don’t you outsource this work to a team of people who can help you? Build or improve the solid foundation you have already put in place in your business. Have a trusted partner to help you get to the next level and beyond. But, before all that, your immediate concern is getting
- Getting next week’s payroll sorted so your employees get paid on time with payslips
- The bi-monthly VAT return is sorted so that Revenue get paid or you get your VAT refund
- Sorting tax clearance with Revenue, or else you won’t get paid from the HSE, or can’t get a licence to trade
Outsourcing
Often, business owners think that “outsourcing” is sending their accounts over to India. And you’ll lose control over that, plus you don’t know who you’ll be dealing with. Not so. For example, if you used us as your bookkeeper or finance department, what you get includes
- A dedicated manager who is a qualified accountant with lots of experience. She is your main point of contact with your team here.
- A payroll expert who looks after all your payroll needs, if you need that.
- Qualified bookkeepers to keep track of your income and expenses, and sort your VAT returns
- Invoicing and debtor’s control.
- Paying creditors following your approval
- Management accounts at regular intervals that suit your business.
- Tax expertise to ensure your returns are nailed on. Plus, advice when selling or passing the business to the next generation.
- Scrutiny of the numbers and insights from experienced accountants.
- Year-end accounts very quickly post year-end, that banks or insurers want.
If one person can do all that, then he or she is worth their weight in gold. And worth a pay rise too!
Trusted Partner
Do you have a trusted partner who you can bounce ideas off when it comes to big decisions? In the modern world, you are so busy working that you don’t have time to talk to your accountant. In a lot of cases, you don’t need to talk to him/her. Business is strong, there’s money in the bank, and Revenue are paid. But that doesn’t mean that you don’t need to invest in your finance function.
You are exhausted. This level of work isn’t sustainable, but you’ll stick at it for another few years. Or you want to take things easier and have a couple of employees who can drive the business on. Whatever the circumstances, you want things to change. You’re not sure of your options. Can you sell? What about an MBO? Could I transfer the business to young Jonny? How much is the business worth? Can I take some cash out? What about the taxes?
This is where having a trusted partner is vital. Someone to bounce ideas off. Someone who can value your business and advise you of your options. Having the foundations nailed on, along with the backup of quality advice when you really need it. I’ll ask you a question. How valuable was your accountant when COVID hit? Was he/she there for you? Did he/she help you with the wage subsidies and business supports? Did they return your calls? Or was it the opposite?
Client frustrations
The two major client frustrations are
- An unexpected bill and
- Not being able to contact your accountant
These two things drive clients nuts. The lack of contact or not getting a call back can be more common in larger firms. They tend to have a higher staff turnover, and your main point of contact changes regularly. An unexpected bill shouldn’t happen. Our policy is to agree all fees for specific services upfront. If there’s extra work above the agreed for services, then that’s agreed before the work starts. It’s your choice, and you decide if you want the service or not.
And your dedicated manager is available to you outside their normal holidays. They are your constant. If something is not working or you have an issue, you know that person will sort it for you. They are on it for you and will do everything to sort it, and if they can’t, they’ll get other team members involved.
Bottom Line
By investing in something, you expect it to grow. To be worth more in the future than it is today. To grow your bottom line. Your business is more profitable and consistently so. That consistent growth means more money in the bank. But that’s company money, and you own the company. You ask yourself. I have all this money sitting in my company bank account. How do I make that work for me?
That’s the golden question, and where your trusted advisor comes into their own. Some of the most enjoyable work for us over the years has been helping clients
- Buy their first home
- Clear off their mortgage early
- Reduce their debtors by more than 50%
- Start a company pension
- Sell their business to brilliant employees
- Pass their business to their son while retiring and getting a lump of money
- Setting up holding companies
- Move from a sole trader to a company
- Take more money through salary, bonus, and dividends
Investing in your finance function will help the bottom line grow. It doesn’t guarantee it. It’s not a flick of a switch thing. It takes time and money to get the right financial systems and processes in place for your business. But when you get it right, it adds value to your business, which adds value to you. More money in the business equals more money for you. We’ll help you nail the foundations, and you’ll have access to a quality team. Your trusted partner that’s there to support you on your business journey.
If you don’t, that’s ok too. You won’t ever miss what you don’t have. But I’ll leave you with the words of Jimi Hendrix from the same song.
“Look, a golden-winged ship is passing my way. And it really didn’t have to stop. It just kept on going
And so castles made of sand
Slips into the sea eventually
Protect your castle and nail your company finances with a trusted partner? If interested, start here
