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Cash Is King: Small Business Accounting

Posted by:     Tags:  ,     Posted date:  August 10, 2010  |  6 Comments


August 10, 2010


Generally, when you mention accounting to entrepreneurs – a glazed look of trepidation [slight fear] swims across their faces. And even if by chance, you did well in Accounting 101 during college – it wasn’t your forte and bean counting wasn’t as glamorous as you might have wished. So how do most entrepreneurs start the beleaguered task of developing a strong financial system? For some it starts with a shoebox, folder system or pocket lint cash account. The hard truth is that none of these systems will help business owners address pertinent issues that will arise as a company grows over the long-run. It’s really important to get a solid handle on finances and the state of your business early on.
So, why is accounting so important?
  • Strong financial records are key if you ever decide to pitch to VC’s [venture capitalists] for funding
  • Financing from financial institutions, such as credit unions or banks, will require historical performance data
  • To run lean and mean and get a better handle on expenses, knowing where your money goes is important
  • If you decide to sell your business or merge with another company – financial records are important for valuation purposes
  • Keeping a close eye on business performance will help you grow a sustainable business

“Cash is King” – this simply means that daily operations will require a strong cash basis to keep you moving forward effectively in your business. Cash flow is the lifeline for a business. Thirty-two percent [32.1%] of small businesses fail due to poor management of financial activities. Twelve percent [12.3%] of small businesses fail due to poor books and records. The great news is – these are all areas that are within your ability to control, fix and improve upon.

Many startups decide to go at it alone – which can prove detrimental in the long-run. If you have a strong financial background and competency with numbers there are effective online accounting tools that can prove extremely useful. However, as business grows, outsourcing can help you assess business performance and increase profitability. Finding a good bookkeeper or accountant is essential for growing businesses.

Imagine accounting utopia – waking up to real-time charts and dashboard snapshots of your current financial snapshot, having a keen view of your Accounts Payable and Receivables and being able to forecast revenue trends with historic data. While it seems far-fetched and likely very expensive, a company called Dashboard Accountants may simply be up to the challenge. Dashboard Accountant’s introductory free pricing pamphlet explains their core services and enables customization based on your individual business needs. Most importantly, they offer full-service options for bookkeeping solutions, payroll and CFO services. No matter what level your business is currently at the services offered can grow with your company along the way. Cash flow is king and Dashboard Accountants may just be the strategic and cost-effective advantage needed to move your business forward? Take a look, try a custom quote and let me know what you think about their services.

Not ready to hire or outsource your bookkeeping or accounting needs? Checkout Bookkeeping in a Box. Share tips and success stories with the YFS community and let us know what works best for you in the comments section below.

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Erica Nicole is the Founder and CEO of YFS Magazine: Young, Fabulous & Self-Employed. She is an accomplished serial entrepreneur, acclaimed small business expert, dynamic speaker, syndicated columnist, philanthropist and Christian thought leader. She has been featured in Forbes, Fox Business, The Huffington Post, Mashable, AOL.com, Examiner.com and many other national media outlets.



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  • http://www.michaelgholmes.com Mike @ Biblical Strategies for Startups

    Erica,

    i must say I enjoyed this post and agree wholeheartedly: accounting is soooo fundamental. I recently did a post: “3 Financial Fundamentals You As a Startup Should Know.”
    http://michaelgholmes.com/2010/09/02/3-financial-fundamentals-you-as-a-startup-should-know/

    I only wish I saw this post before so I could have included it.

    Great stuff!

  • http://www.yoursimplebookkeeper.com katrinamharrell

    Hi Erica,

    This post was great! I can tell you truly value the benefit of an accountant. I guest blog for http://www.thecashflow.com on the subject of “Cash is King”, planning for tax season, the REAL reasons businesses fail and why to hire an accountant so this was great!

    I provide similar services to Dashboard AND bookkeeping in a box as well. There can never be too much information on this subject so thanks for posting it!

    I often teach my clients that yes, Marketing Rules, But Cash is King!

  • http://www.magicaccounts.co.uk/our-packages SmallBusinessAccountant

    Erica you are doing fantastic job by writing this. I always wanted to be a entrepreneur but there is no suitable way or a proper guidance but you did it . Good . Your both blogs are well presentable form and clears each and every thing in a descent manner and interesting too. thanks for the blogs.

    • http://twitter.com/YFSMagazine YFS Magazine

      Awesome! Thank you.

  • http://twitter.com/YourSimpleTweet YourSimpleBookkeeper

    Great post!! 

    • http://twitter.com/YFSMagazine YFS Magazine

      Thanks! We’re glad to have another finance savvy YFS reader here!






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