Don't Underestimate the Importance
of Your Financial Image

Don't underestimate the importance of your financial image in the business community. Entrepreneurs need to create and maintain a positive financial image to stay on track for growth. Your financial image affects your ability to get a loan from the bank, secure funding from investors, establish credit with vendors and eventually, to sell your company.

If your financial statements and projections look like they were prepared by an amateur, the business community will lose confidence in you. If you are the manager of a high-growth firm, consider these three tips for enhancing your financial image:

Tip #1: Assess your situation. If you experience financial errors, cost and expense miscalculations and business losses, you may already be aware of a problem.  Many business owners focus on revenue-producing activities, such as sales and marketing, to the detriment of keeping an eye on the bottom line.  Clean and current financial information is often the last thing on the owner's agenda.  This can create a panic situation when you suddenly realize there is a negative cash flow and it is time for a loan.  Meet regularly with your accountant to discuss what is happening with the business and to examine your financial condition.

Tip #2: Staff your accounting department appropriately. If you are growing quickly but are not receiving operating results and cash flow reports promptly, it may be time to expand your internal accounting department.  You are especially vulnerable to financial miscalculations if you are responsible for resolving issues ranging from research and development to human resource.  
We can assist you in hiring the right internal team to do the job needed internally, while we provide you the external accounting support you need.

Tip #3: Make the most of your relationship with your accountant.  Get your accountant involved at the earliest stage of the business.  Work with your accountant to create a business plan with a timeline for financial and marketing goals.  Ask for introductions to lending sources.  Get suggestions on the right accounting software.  Meanwhile, allow your internal accounting department to handle day-to-day accounting functions.  Your accountant can help you get the right people into the right accounting department positions at the right time.  A sound financial image also makes it easier to attract top talent in all areas of the business.

When you fail to produce accurate and professional financial reporting, you create the impression that your management does not have its act together.  A positive financial image helps you obtain loans at the lowest rates as quickly as possible.  Beyond your image, accurate accounting helps you run your business within the limits of your budget and make informed business decisions.