Do You Want The
Proven Financial Skills and Advice
Available To Big Businesses
At A Fraction Of The Cost?

Are you unhappy with the way your relationship is working with your current accountants in Surrey?

Do you feel that you need a more proactive or better service than your accountants seem to be able to provide?

If you have a growing business based in Surrey:

• but you are not yet able to justify the cost of recruiting your own internal qualified accountant or Finance Director
• but you need more financial support and advice than you are getting from your firm of traditional accountants,
• we have just the solution for you.

There are a growing number of qualified accountants with years of senior management experience in big companies who now work on a self employed basis, each helping a small number of small businesses control and improve their business finances.

To help distinguish this special service, these accountants are often called Part Time Finance Directors or Virtual Finance Directors but those phrases don't really explain what they are or what they do.

Each will bring many years of experience of working in companies and a focused attention on profit and cash that you probably haven't experienced before.

And the best bit?

Pareto's 80/20 rule says that invariably 20% of someone's efforts produces 80% of their results.

So you may only need somebody for a few days a month to get most of the benefits of having your own full time Finance Director, and because it's on an "as and when needed" basis the costs are lower and you can afford to use a very high calibre person who traditionally has not been available to the smaller businesses.

Using one of our experienced Finance Directors means that you could leave your accounting and tax compliance work to your current accountants. It's probably the service that the firm has been designed to deliver best. Alternatively your new FD may know of an excellent firm with competitive fees.

Our service also works well if you are finding trading tough and you are having to reduce your headcount. In these turnaround situations, the need for strong and effective financial control is essential but again, you may not need a full time FD so why carry the extra cost?

How does this service differ from the service you currently receive from your accountants?

Altough it may be tempting, it's a mistake to think that one accountant is much the same as another. That accounting is accounting.

The key difference to emphasise is on the time period where attention is focused. An accountant usually focuses on the past. It's a record-keeping task. Recording the transactions and then reporting them so that the directors, managers and any finance providers can see how the business is performing.

It's an important role. You need to know what is happening and you need to know what is happening quickly.

A key problem I regularly see in privately owned companies is that when management accounts are produced, they are often produced too late.

To put it in perspective, monthly accounts within one week of the month end is excellent, within two weeks is average, within three weeks is poor and if you are paying for accounts after that then you need to be asking serious questions about the cost/benefit relationship.

The second common problem I see with monthly accounts is the format. Often there are no comparatives. The numbers for the month and perhaps year to date are stated on their own. "So what? What does it mean?"

If those kinds of accounts don't mean anything to me, then they probably don't make a lot of sense to you. Good practice says that any figures should have some comparison, perhaps against a budget or forecast, last year or the last three months. The best comparison for you will depend on your particular business conditions.

The third common problem of accounts I see prepared by accountants more focused on recording the past is that the reporting doesn't focus on the key business drivers.

There may be lots of pages and a vast array of numbers but do your accounts tell you what is happening with volumes, prices, margins, efficiencies, labour productivity or how quickly you are collecting your money from customers.

That's the type of information you need because those are the factors that are driving your profits and cash but so often I see accounts that only have long lists of overheads. That may be useful periodically, or to explain a sudden big variation, but the real action is elsewhere.

Good accounts can be difficult to prepare and may involve some estimation, but it's better to be approximately right with useful information than precisely wrong about irrelevant information.

I say "precisely wrong" deliberately because accounting is a matter of judgement and accounts are never likely to be right despite the fact that they may be shown down to the penny. That's why auditors work to check that the accounts are "true and fair" - they'd never say "right".

The only value in historical information is being able to use it to influence future actions. That's why it's essential that your accounts focus on the main business variables, that's why it's important that you understand what your accounts are saying and the future financial consequences or the issues and trends and that's why it's important that you focus on the future actions you will take.

While accounting focuses on recording the transactions from the past, financial management focuses on the future.

How can your business finances be improved? What can be done to take advantage of a particular opportunity? What can be done to solve a nasty problem?

For a good financial director, the accounts are the starting point for managing the future financial health of your business. For an accountant your accounts are the end point. "Job done until next month."

Your financial director will want to work with forecasts to anticipate issues. Where you need improvements, your FD will want to see clear action plans with specific responsibilities for tasks. Your FD will make an invaluable contribution to your business decisions, wanting to clarify things and understand the profit and cash impacts.

I hope that I have explained how a virtual or part time Finance Director can have a major impact on the future financial wealth of your business. If not call me, Paul Simister, on 0121 554 4057 and I will try to give you a better indication.

To help you find these special people we have created a register of Finance Directors and this includes highly experienced qualified accountants in the Surrey area.

Why not start the process of getting a better control on your business finances now. Email one of more of the people below or give me, Paul Simister a call on 0121 554 4057.

North East Hampshire & Surrey Border - Judith Astles BSc ACA. A chartered accountant (qualified 1986). Extensive senior management experience gained with service companies. Works with SMEs to develop good financial strategy, cash management, management reporting and accounting controls. More details.

Contact Judith by emailing her at judith.astles@plancs.co.uk

Surrey, Sussex, London, Middlesex - David Wicker FCMA. A Chartered Management Accountant, FCMA (1984) who has been helping SME to PLC companies improve their financial performance throughout his career. More details.

Contact David by emailing him at david.wicker@plancs.co.uk

London – Surjit Khaira BA ACMA. A chartered management accountant qualified in 1992. Over 20 years of strong domestic and international financial experience with an emphasis on commercial development in service businesses. More details.

Contact Surjit by emailing him at surjit.khaira@plancs.co.uk

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Last updated 2007-07-06