Getting Real: The Value of Real-Time Accounting
As we enter the new year, we tend to look ahead and set goals for positive change. While most new year’s resolutions tend to be on the personal front, it’s important to consider how you can improve your business.
We all recognize the importance of financial reporting, but how often do you actually apply that information to manage your day-to-day business? If financial reporting is so crucial, why don’t we use it more often? Typically, financial reporting is a reaction when something isn’t going right, is viewed as a necessary evil that ends up at the bottom of your busy “to do” list, or is seen annually at tax time. If you’re not taking a strategic and real-time financial reporting approach, you are missing out on some significant benefits.
Real-time accounting provides a “state of the business” as it happens. You know exactly where you stand with account balances, revenue, profits, etc. These figures enable you to be much savvier and more responsive to the needs of your business. Knowledge truly is power, and with real-time accounting, you can make more informed, strategic decisions that impact your bottom line. You can’t put a true value on having up-to-date, accurate information.
Recap the Benefits
The most successful businesses are ones that are nimble enough to change course or make adjustments when necessary. But the key is to know when to make those changes. With real-time accounting, you have the luxury of addressing an issue before it becomes a bigger problem. Plus, the ability to compare previous periods can help uncover the “why” of success or failure.
Additional benefits of real-time accounting include:
- Better cash flow management
- Faster identification of any tax liabilities
- Potential to catch fraudulent activity quicker, and
- Ultimately better peace of mind
Be more proactive in your management, capitalizing on opportunities that show themselves in your numbers. If you aren’t sure where to start, look at small ways that can make a big difference. For example, if you do your books annually, changing them to quarterly or monthly will begin to provide advantages.
Another option is to consider cloud computing. Cloud computing enables you to have instant access to financial data anywhere, at any time, from any device. More and more companies are switching to the cloud with results that transform their accounting function. This safe and secure option will provide you with an unobstructed view of your current financial position while saving you time and money.
Outcomes and Obstacles
Companies who work smarter by utilizing real-time accounting, experience higher accuracy regarding actual to budgeted revenue. With their greater visibility, these companies also maintain an agile strategy that responds to the ebbs and flows of the business versus knee-jerk reactions.
So why doesn’t everyone focus on real-time accounting? If you don’t have the appropriate staffing resources, real-time accounting can be nothing more than a bullet point on your wish list. To overcome this, many businesses rely on outsourced accounting services to supplement their existing accounting department with experts to handle back-office accounting, payroll, and financial reporting. When you leverage outsourced expertise, you can close your books faster, seize opportunities quicker, and accelerate your strategic goals at a fraction of the cost of hiring a full-time equivalent.
Contact Managing Director, Outsourced Accounting Services, Lisa Lee, for a consultation and discuss the steps your business should be taking throughout the year to drive success and boost profitability.