With the coming of cool weather brings the countdown to the end of the year. For small business owners it is the perfect time to really take a look at how your company has been performing during the year because you still have time to make some changes. By reviewing your financial statements you can obtain some great information.
Looking at your Balance Sheet (a snapshot from a point in time) you can determine how your assets are distributed and how much money you have out as a liability.
How is your bank balance? Is it sufficient to pay your current bills?
What is your Accounts Receivable balance? Should you be putting pressure on those non-paying customers? Perhaps you can set-up payment plans?
Is your inventory too high? Have you done a physical count?
Have you purchased any new Equipment, Furniture, Fixtures? Are they categorized as Fixed Assets?
Have you invested in anything (Land, Stocks, etc?) Have they been recorded?
Who do you owe money to? Are your current assets less then your current liabilities?
Can you set-up a payment plan to get rid of some debt?
Looking at your Profit & Loss Statement (a period of time) you can determine how much Income you are bringing in and were it is being spent.
Have your sales increased or decreased from last year?
Is your pricing consistent with industry standards?
Is your Gross Profit were you need it to be?
What is your biggest expense?
Can you cut costs anywhere?
Finally, what is your Net Income (Loss)?
Financial Statements are great tools to use. If you currently use an Accountant or Bookkeeper, ask them to review your reports with you today or reach out to me!
Good to Know!