BNI Minnesota & N. Wisconsin Blog

By B. Scott Binion, CPA

You hear it from your accountant.  Your financial planner keeps asking for it.  Your banker really wants to know.  Asking for what?  They want to know that you are keeping track of your business and personal financial affairs.  Are you asking yourself the same question?

Imagine if your bills were paid without knowing what the account balance was!  What if you overpaid the bank loan or your copier lease - again?  A $49 dollar late fee for paying a credit card late!!!!!

The following tips are for those that this has happened before.  Keeping track of where you are is more important than that next deal or sale, no matter how big the deal may be.  These may be simple on the outside, but pack a huge return over time.  We’d all be surprised of how many are not even given a second thought.

1. Keep a physical list or ledger of your checking account – even if you have an accounting system
2. Always have envelopes available for expenses paid for using your own cash
3. Reconcile your accounts shortly after receiving your bank statement
4. Create an accounting of ALL of your transactions
5. If you are too busy, don’t know how, or just don’t want to mess with it, hire a bookkeeper
6. Outsourcing may be a lot less than you actually expect

So listen to your CPA.  Take the advice of your financial planner.  Take notes when your banker makes this request.  Next time they ask, you can say YES, I keep very good track of my financial affairs – Want to see my books? 

By B. Scott Binion, CPA

What are you counting in your business?  Of course you count where you’re money is going and maybe wondering where it went.  You count how many of your employees show up each day and who is there to get the work done.  You count the number of customers coming in or going out the door.  You maybe count the calls you receive or the meetings you have to attend.  Maybe it’s the number of customers you gained or lost.  Realistically you probably count just about everything whether it’s in your mind or written down.

But does it really matter what we count?  You bet! It matters for at least most of what is counted.  In my opinion, here are a few important things to count in your business right now, no matter how simple they may sound:

• What you have coming in
• What you have going out
• What is on the immediate horizon
• What’s on your list to accomplish this year
• How are you doing so far

Without enough cash coming in your business will end up faltering.  Too much cash going out can’t last long – your borrowing capacity will end at some point.  Your immediate horizon is so vital to being profitable.  What customers are coming on board or projects about to begin?  What marketing efforts are under way and when will you see some positive results? 

You must count what you have going on in the next 3 to 6 months to set your business up for success for the next year or two. 

So don’t stop counting what matters!