Financial Fundamentals Part 1

A fundamental dynamic of business is paying attention to the organization’s financial performance and stability, not just for now but sustainable into the future. The best way to do this is dropping the old mentality that the accounting and finance department is strictly for reporting history and counting widgets.

The financial department should be proactively involved in supporting the future of the organization through value-added activities. These include contributing to leadership discussions; identifying areas for improvement; leading cost effective design; detecting inefficiencies in processes; changing the way accounting is utilized; participating in the implementation of strategic plans; conducting benchmarking studies; developing best practices; supporting integrated information systems; analyzing trends and opportunities; and building relationships throughout the organization along with outside stakeholders from investors to lenders with capital funds for expansion. Simply put, the financial team members are critical to building, shaping and developing a successful transferrable business.

With today’s technology, the old transaction processing and data entry of the traditional bookkeeper should not make up your entire financial department.