What value does an FD add to any business?
Broadly, there are four things a good FD adds to any business:
1. Financial information
No business can last for long without solid, consistent, up to date performance information that looks at:
- P&L, compared with budget, last year, forecast
- Margins
- Debtors
- Cashflow forecast
- Client & product / service profitability
2. Financial controls and processes
Mostly, these are routines that happen every day, week or month and need to work like a well-oiled machine:
- Solid bookkeeping that’s right, first-time
- Frequent bank reconciliations
- Robust credit control
- Intelligent cost control
Without these processes and systems working well, the financial information required simply won’t be produced in a useful way.
3. Getting other areas of your business to be aware of financial issues and constraints
Ensuring that everyone in the business is aware of the financial dimensions of their job, particularly when making decisions.
4. Being involved in occasional and one-off decisions and projects
Investing in new assets, buying / selling businesses, promoting or recruiting senior staff, lease renewal. These are some of the issues that pop up from time to time and require experienced financial input. But they don’t arise every day.
All of this is important, so why don’t I need an FD?
The tasks listed above are either routine, day-to-day or monthly tasks or they’re occasional issues that pop up rarely. The routine tasks can be dealt with by good bookkeeping and accounting staff, or they can be outsourced.
The occasional issues are exactly that and don’t need an expensive, permanent presence to deal with them.
If not an FD, then what’s the alternative?
A far better answer for most businesses is to enlist the help of people like Blue Dot Consulting to act as a part-time FD to:
- put in place the financial processes and controls you need
- train and coach existing staff to do a more demanding job
- ensure the right information, bespoke to your business (not the standard reports that you currently get from your accounting system), is coming out to those who can act on it
- maintain an ongoing presence in the businesses to ensure that everything continues to run as normal
- pitch in to the occasional decisions as and when required
This gives your business the best of both worlds – the senior financial input you need but without a full-time cost.
It’s a solution that an FD would be proud of!
Call Michael Austin on 020 7125 0270 or email info@bluedotconsulting.co.uk and let’s have a free-of-charge chat about your business.
Michael – @bluedotmichael
Related links:
Bookkeeping for small business – don’t get lost, get help
You can’t run a £1m business and only have your bookkeeping updated every three months!
Chartered Accountants – Bedford House, Fulham Green, London, SW6 3JW
