In Pursuit of Profit
Read our expert article below or sign up to get articles sent to your inbox.
I’ve seen many clients struggle to find accounting help over the last two years across all employment levels – from bookkeeper all the way through CFO. I’ve seen new hires simply not show up for their first day without any notice. I’ve seen new employees resign less than a month after starting for other opportunities or just to leave a work culture they don’t like. Workforce expectations have shifted dramatically over the past five years and employers are struggling to fill open positions amid these changes. In fact, Manpower surveys indicate that 75% of employers report difficulty in finding skilled accounting talent.
However, you can’t guarantee that the process will go this well. Sure, you can communicate that you expect employees to bring this kind of tact to the transition, but you cannot control their timing or actions during the process (and sometimes neither can they depending on the circumstances involved!). Instead, you need to have a formal succession plan in place to safeguard the business against the kind of disruption that can happen when an accountant leaves unexpectedly.
The time to get ready is now! Plan for your accountant’s departure before you need to do it so you can be properly prepared.
The role you need depends on your business needs, so let’s look at common business triggers that most likely require needing the next level of financial role, and what kind of activities and responsibilities each role typically includes. We’ll start with bookkeeper and work our way up to Chief Financial Officer (CFO).
Whether it is due to taking a job elsewhere, switching careers, personal/family needs, medical reasons, or some other cause, the unexpected loss of an accountant can throw a business into disarray. Reining in this chaos as quickly as possible is critical to ensuring the viability of the company.
Recently, we talked to a set of business partners that epitomized this situation. They suddenly found themselves managing a family business after the untimely passing of their uncle who had been running the business for the last 20 years. They were coming to the table with little accounting knowledge and too much grief and shock to be able to invest themselves in running this aspect of the business themselves. They needed help! Now, this example may not represent exactly where you are, but there are plenty of situations where people find themselves at the helm of a company’s finances without the experience needed to be confident in the work that they are doing. If this describes you, you’ve come to the right place! This guide will give you a quick overview of what is most important when it comes to managing your company’s books and overseeing its accounting functions. It will also offer additional resources for each topic so you can gain a greater understanding of the places where you need the most help, allowing you to feel better equipped to lead in these areas.
And while A/R problems are often errantly believed to exist most commonly at large companies processing a high volume of invoices every month, the research proves that to be false. The companies that tend to be the most behind are those processing between 300 and 2,500 invoices every month.
Clearly, small businesses are the ones most likely to have A/R issues, which is a real problem because the fewer invoices a business has, the more important collecting on each one becomes. For instance, if a company is processing 10,000 invoices every month, and 50 of them are outstanding, that is only 0.5% of its revenue that has not been collected; whereas, if a company is processing 1,000 invoices, and 50 of them are outstanding, that is 5% of its revenue that is outstanding every month. Failing to collect on outstanding accounts receivables is a serious problem because, as the CFO Selections team explains, “The longer an invoice goes without being paid, the less likely it is to get paid at all. On average, 26% of invoices are uncollectable at the three-month mark, but that number rises to 70% at six months and 90% at 12 months.”
Whether the problem is nefarious in nature or not, incorrectly accounting for expense reimbursements can open a business up to an IRS audit. Being audited consumes time and resources even if the business being audited prevails. However, it can also cost a company in fees and penalties if misreporting problems are discovered. For this reason, improving cost reimbursement policies and processes should be a top priority for companies that want to not only mitigate fraud risk but also reduce their likelihood of being audited.
7/31/2023 Is a Zero-Day Close Possible?
Accountants that have been in the industry for decades may find this idea unfathomable because they are used to the regular cadence of time-consuming, stressful closing procedures that never seem to go smoothly. And yet, as automation becomes ever more prevalent in accounting and finance, the traditional bookkeeping role is becoming largely replaceable by software, taking with it some of the tediousness and historical pain points that have traditionally been a hallmark of the industry. Will a manual month-end or year-end financial close soon become a relic of the past?
What about your accounting platform? Is it keeping pace with business needs? Does it provide the kind of functionality that your business needs to take that next step (whatever it may be)? Does it offer sufficient automation to streamline human efforts?
The reality is that the companies that need accounting help the most typically aren’t even aware that they need help. If you’re not sure how your accounting staff and systems are working together to deliver on key accounting functions, here are some red flags to keep an eye out for: 7/10/2023 Do Accounting Job Titles Matter?
I discovered many parts of the HR world matched my interests, so I wanted to be a finance leader who had some real HR knowledge. I pursued an SPHR (Senior Professional in Human Resources) designation, which required studying materials and taking an exam. As time passed, I realized recruiting was the part of HR I really liked because I am a lifetime connector. Fast forward to today and I have spent most of the past 20 years as a recruiter.
One topic that is a continual area of consternation within the recruiting world is job titles. Job seekers and hiring companies alike struggle with accounting and finance job titles. I’ll tell you why and what you can do about it when looking for or posting an accounting job:
Either way, they typically come to us with their books in disarray looking for someone that can get them back on track and put the foundational elements in place for them to manage continued growth more effectively.
Their goal is not simply to have clean books for the mere sake of doing so. Their goal is to have the kind of accurate and timely financial information needed for strategic decision-making – enabling yesterday’s growth to fuel tomorrow’s growth as well. They understand that sustainable growth must be built on a solid financial foundation. |
SUBSCRIBE:DOWNLOAD:DOWNLOAD:Categories:
All
Archives:
April 2024
|
Services |
Company |
|
10/23/2023