How Financial Statements Help Your Business
- October 26, 2017
- by Barsz Gowie Amon & Fultz
You’re a business owner. You already keep good financial records. You know your business is profitable. Your tax returns are airtight. Why in the world would you need to regularly prepare financial statements, too?
Of course, you know your business is doing fine, but others may need convincing. You may need financial statements as proof for investors, financial institutions, other company managers, shareholders, suppliers, government agencies, and, perhaps, your own peace of mind. Being able to see the facts and figures that prove you are successful is important – and it can be empowering.
Regular financial statements can lead your business to:
- Better Decisions – You should review more than your bank statements when you are thinking about investing money back in your business, for instance. Financial statements give an accurate snapshot of your business performance. With it, you can clearly monitor progress and identify growth opportunities.
- On-Time Payments – Financial reports may ensure customers pay on time, and accounts payable reports may ensure your vendors are paid on time. They also help you predict future cash flow.
- Tax-Readiness – Financial statements that are updated regularly will keep you neatly organized for tax time. No shoe box full of receipts!
- Flaunt Your Success – If there ever comes a time when you decide to sell the business or obtain new investors, regular financial statements will become your historical record. They will be a detailed map so others can figure out how you’re doing and how you’ve done. In addition, new clients and suppliers may actually request financial statements to determine if they should conduct business with you. With a record of financial statements, you’ll be ready in a shot.
- Identify Mistakes – Setting up a schedule to create and review financial statements will help you identify mistakes – and identify them as early as possible. They may help you detect theft, fraud, or illegal activities. How valuable is that?
To get your business reporting in tip-top shape, consider hiring a professional accountant or bookkeeper to not only get your finances and accounting in order, but also one who will systematically create financial statements that tell your business’ story – its past, present, and at least a prediction of the future.
Contact Barsz Gowie Amon & Fultz to find out how we can help your business thrive.