Why Your Business Needs Management Accounts!
Call them performance management reporting if you'd like ...
POSTED BY JONATHAN VOWLES ON 20/08/2019 @ 8:00AM
An F1 team measures hundreds of things during the course of a race, all with the aim of working out how to do it better next time ...
Just like an F1 team, you need to be measuring your performance to see what works and what doesn't!
photo by shen liu on unsplash
So, should your business measure and report on its performance, so that you can work out how to do it better? Yes, of course it should.
OK, so I am an accountant who does management accounts, and I would say this, wouldn't I? But before you click off this and on to something else just think of these three points:
Research shows that 'what gets measured gets managed'
Everyone knows that they can improve their business, but how much better to get a report that highlights areas to work on?
Better information leads to better decisions!
Put all this together, and it creates a compelling reason for having regular (monthly or quarterly) management information.
What do we call it? Management accounting is a boring phrase to use, and a more descriptive term would be 'performance management reporting', and let's face it, that is what it is all about.
"Reporting on your performance so that you can
work out how to improve it!"
Profit is a consequence of sales and costs; you can't directly control profit, which means that in order to improve your profit, you actually need to work on those things you can control. Start with your sales processes and then look at your operational processes ... and create performance reporting so that you can see how you are doing.
"Would you like to know more?"
If you would like to look at your performance management reporting (management accounts, just with a better name!) then do give me a call on 01234 752 566 or click here to ping me an email and let's see how I can help you.
Until next time ...
More about Jonathan Vowles ...
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas, which can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.
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