I’ve got a question for you.
Are you and your accountant aligned with where you want to take your business?
I just got off a call with a client, and during the call they said, “Oh, we had a meeting with our accountant yesterday.” I said “How did that go?” And they said, “We’re really, really confused.” I said, “Okay, tell me more.”
They had been speaking to their corporate accountant, and the accountant said to them that from their perspective, the business was going spectacular.
They used the word spectacular.
Your business performance this year is spectacular.
Now, the reality is that this company is slightly up on its revenue and profit from last year, like single-digit growth. But they’ve been heavily impacted by this COVID-19 lockdown to the point where their revenue is down over 50 percent. And they’re having a meeting with their accountant to talk about some tax planning and the accountant is telling them that things are going spectacular. They almost fell off their chair.
This is a classic example of misalignment. Here’s the entrepreneur feeling stressed, watching every dollar, obviously seeing their business revenues and profits decline presently and unsure of what the future is going to be like. And then you’ve got the accountant looking at historical data and drawing a conclusion that the business is going spectacular.
Every business owner needs someone that aligns with them financially in the business and helps to get the balance between the historical data and the future data.
Every business owner needs someone that aligns and helps them understand what they need to push and pull in order to move the business to where they want to go and tells them the truth about how things are, not making it better or worse.
Every business owner needs someone who will sit there and say, “Hey, our target was $100,000 in revenue, we hit $50,000, that’s gonna have this cash impact on us for the next couple of months, what that’s going mean for our targeting and what do we need to do in order to get back on track is A, B, C?”.
That’s the type of aligned financial conversation you want to be having with your accountant or your CFO. And if you’re not having those conversations, you need to review who you’ve got in your circle of influence helping you because it’s critically important that you’re getting the right information.
At the end of the day, the game of business is all about the numbers, right? The way you win or lose is through cashflow and profit. And if you’re not being guided on the right information around those areas, you are going to lose the game.
You’re trusting these people in critical areas of your business. You can’t have them feeding you the wrong information especially when you don’t have the time to go and learn all about it.
So ask yourself:
1. Do you feel that your accountant is aligned with you and where your goals are?
2. Does your accountant even know what your financial goals for the next one, two, three years are?
3. Are they giving you the right advice around that?
If you need any assistance, please feel free to reach out. Otherwise, we’ll chat soon.