If you don’t know what you don’t know about business numbers, here’s the basics…
1 Data Entry
Transactions, payments and other numbers are entered into a paper/software system by a bookkeeper, accountant, assistant, partner/friend/family, or you.
Someone above or a virtual CFO uses the numbers in the system to create reports.
The report could be about the past or the future, about the whole business or a part, and cover any time period.
Common reports: profit & loss / income statement, balance sheet, cash flow statement/projection, budget.
The report could be used for government/other compliance, or for analysing the business.
The most valuable stage.
Analyse how your business did in the past or might do in the future.
Look for errors, trends, unusual variations, compare to benchmarks.
Then think about what to do differently, and implement a plan.
Each stage builds on earlier work, so give feedback for improvement.
Changes could include fixing small errors through to a major overhaul in data entry and reports so that the analysis stage has a clearer or more detailed picture.
Now you know
What stage do you need to work on, or want to know more about?