I wanted to jump into this blog post by gushing about the deliciousness of babies – the (good) smells, sounds and snuggles. Alas, my time spent recording baby milestones has long since been replaced by the tracking of financial reporting and growth of Harmoney’s clients. While there are no snuggles in financial reporting, much like parenthood there is growth and development to be tracked and celebrated.
Like our clients, Harmoney is a growing business. We’ve grown through the referrals of our CPA partners and fantastic clients and have increased our client list steadily over the past five years. Our team of dedicated and talented accountants continues to grow and, in fact, we welcomed a new account manager to the Harmoney team just last week. Not to be overlooked, we are also a team of wonderful humans, some of whom have growing families including a now 10-month-old for one of our team members.
Earlier this year, the first-time mom of this little one mentioned that her daughter had her first winter cold. Not having previously parented a baby with a cold, she didn’t know what to expect in the coming days. How long will the middle of the night wake-ups last? Will she and her spouse catch the baby’s cold? Being the first time through, she had no reference point for how to navigate the days ahead. Her family was working without a net – and most likely without sleep.
As a business owner, have you ever worked without a net? If you are like the hundreds of business owners I’ve gotten to know in my career, the answer is “quite possibly”. Let’s dig into that for a moment – from a business perspective, what constitutes a “net”?
A “net” in business could manifest itself in a couple of ways. It could take the form of something tangible such as a cushion of cold hard cash in the bank readily available for something unexpected; or an extra pair of hands or two during a busy season to service more customers. It could also present as something intangible such as the confidence gained over years of running a business and the wisdom that comes with navigating challenges.
When it comes to being prepared for the unexpected, business owners have a powerful tool they can use that is not available to the first-time parent: Comparative financial statements (we are sooo far away from babies now). When bookkeeping has been done properly and consistently, the history contained in the accounting software is a treasure trove of valuable information that can be analyzed, sorted and gleaned for insights. These comparative reports – Income Statement and Balance Sheet – identify trends in multiple accounting periods and can be analyzed by month, quarter, year or any period that is relevant to a business.
Comparative reports give context to figures, identify trends in income and expenses, and allow for insight that indicates the health or needs of the business. As an owner, financial reporting is the best reading you can do for your business. Run standard reports and dig in to the numbers, change the dates and the basis, dig in again. What patterns are you picking up? Good, bad or ugly, data points over time serve a golden purpose and the owner who stays connected with their numbers on a monthly basis will never be without a net.
How up-to-date are you on your bookkeeping? What reports are in your monthly financial package? Don’t know? Oh baby, call us and we’ll show you the beauty of comparative financial reports