Another Financial Year over (and a new one just begun)
Another financial year has been and gone and, with hard work, your bookkeeping is up to date. After taking time to catch your breath, the start of a new financial year is a great time to momentarily lift yourself out of the day to day and take a ‘helicopter’ view of your business.
• Was the last financial year successful?
• What went well?
• What could have been better?
• Do I need to invest?
• Is there anything I should stop doing?
• Are my processes efficient?
• Are my business financial records in good order?
Whatever your situation, here are a handful of things you can do for your business before the demands of the new financial year take over.
Review and update your business and marketing plans
If things didn’t go according to plan, or even if they did, now is a good time to think about what you might do better. Start by digging out your business and marketing plans from the previous year. Take some time to remind yourself of your goals and priorities and assess which of your strategies may need to be revised.
Take into consideration any changes in your environment and market, including new regulations or taxation, and any changes that you anticipate happening over the next twelve months.
To provide a broader perspective it may be worth asking for external advice, from your accountant and business advisors, and your suppliers and customers. Also remember to get feedback from the rest of your team, not only did they live though the last twelve months, they have responsibility for delivering your results over the next year.
Don’t forget to update your business plan with your new priorities and set milestones over the coming twelve months to regularly track your performance against the plan. And don’t forget to share your plan with your team.
Review your finances
Now that you’re through the year-end financial tasks, reconnect with your accountant and review your finances. Look at your targets for the last financial year. Did you meet them? Discuss why or why not? Where can you grow revenue? What costs can be reduced?
Set performance targets for the next year, create forecasts, and plan for specific events around cash flow, funding, and expenditure.
Get your financial records in good order
Good financial records go ‘hand in hand’ with good financial management. Remember, ‘What is measured can be managed.’
Quite often the scramble at the end of the financial year happens because your financial records aren’t the best. Keeping up to date and knowing where everything is makes it quicker to prepare your accounts at year-end. For example, take some time now to establish folders to save your PDF reports to.
Inaccurate records also make it difficult to make good decisions, both in terms of daily operations and planning for the future. Good records allow your accountant to offer you sound advice. They also help identify the strengths and weaknesses in your business, and measure the impact of any changes that you make.
Invest in better systems?
Part of getting your financial records in order may involve reviewing your current business systems and making tweaks to your processes. Or, it might require investing in a better system.
Maybe your business has grown substantially over the year – new products, more people, or additional offices? Are your records in disarray? Rather than sourcing new leads, closing sales, and managing your team, are you fighting battles with your bookkeeping?
Now may be the time to take your business to the next level and consider an Enterprise Resource Planning (ERP) system that will provide effective and efficient functionality across a range of business areas.
Protect your Business
Don’t forget to protect what you have already got. The start of the financial year is also the ideal time to make sure your insurance is up to date and your data secure.
Review your insurances
Check that you have the right insurances in place for your business. Make sure your data, computer systems and audits are included in the cover. If your circumstances have changed, you may need to update your level of cover.
Backup and secure your files.
Backup your business financial and customer information regularly and store your backups in a secure off-site location. This helps to ensure your business can stay up and running during unexpected events.
Also make sure all your software is up to date with the latest releases. The use of ransomware to disrupt computer operations is a growing problem for small business owners and many of those impacted by the recent “Wannacry” Malware attack were using Windows machines that were not fully up to date.
A new financial year can be an ideal time to make some changes in your business, including organising your financial housekeeping. Setting aside some time now to plan for the next twelve months will lead to a more rewarding end to the next financial year.