Unless you are operating in the financial sector, it can be hard to know how your financial processes and procedures stack up, with your accountant acting as the gatekeeper in identifying and implementing change. If you are looking for more transparency from your accountant or simply wanting to get a sense of the present and future opportunities for improvement, here are the 5 questions you need to ask your accountant.
“What services are available to me that can enhance my financial standing and business processes?”
Many businesses will appoint their accountant for A, without learning at the time or in the future that they could also be using B and C services. Your accountant will likely have the skill and capacity to offer some incremental services, many of which might reduce the responsibilities that fall on your shoulders. What your accountant suggests will vary due to the size of your operation and the nature of your business, but enquire about the following time-saving services:
- Payroll consulting (small business, corporate)
- Single Touch Payroll
- Migration of Multi-Factor Authentication
- Time & Attendance facilitation
You can even ask your accountant to provide some examples of how these services have assisted other businesses, and what this could look like for your operation. If you already have an accountant you like, it makes sense to roll out additional services under that individual/partner rather than creating another unnecessary reporting line.
“What is my core business that makes up the bulk of my revenue?”
This is a critical question to ask your accountant, as you may find that client/customer A demands 80% of your time and attention, but only generates 20% of your revenue. Whereas client/customer B who requires minimal effort is actually contributing to 80% of your revenue. How different your business could look if you were only serving core clients and revenue streams that make up the foundation of your business.
Knowing where your revenue is generated will inform how you drive your business, and with who. If you have found that you can’t possibly generate more revenue with the hours given, this might be enlightening learning that will change how you account manage, with those claimed hours now put toward finding more businesses like client/customer B.
“What is my break-even point?”
It’s incredible how many businesses operate without knowing what that magical break-even number is. You should have no ambiguity here, because how will you know what is a good, bad or ideal month? You should also ask your accountant to update you every time that break-even point is revised, like when you hire or relieve staff, change your overheads and market conditions shift. Try and build your KPIs, business plan and projections on this figure, and only explore opportunities if it satisfies this key requirement.
“What are your successful clients doing, and is there anything there my business should be perusing?”
Traditionally speaking, an accountant will not infer how your business should run, but that’s not to say you can’t glean some intel about what their more successful clients are doing. You as a business owner cannot be everywhere, and your assessment of a successful operation is heavily biased based on your own preconceptions and business journey. Not to mention, we tend to have tunnel vision when it comes to the way we do business, not steering from our vertical. Your accountant might offer strategies that are yielding strong returns for retail clients which could easily be applied for your food and beverage business. Be sure to ask about successful clients in all industries, as success can always translate. A restructure and a set of fresh, experienced eyes might be the missing piece needed for your business growth.
“What should my financial targets be for the next one, three and five years – how much growth is realistic for my business?”
These projections should be built into your business plan, but chances are you did not factor in the input from your accountant. Visibility, customer retention and YOY growth is great – but you need a figure that you can work towards and understand how and why that is growing, maintaining or reducing as the years go by. Now when you get those targets from your account, don’t be afraid to probe them and learn how they came to these figures and what sort of external and internal forces could impact that target. It’s also great to pass this feedback on to your team, as you want to be working towards achieving these targets as a team, united in shared knowledge and strategy.
There are many more questions you could ask your patient accountant, but these are a great place to start. Start having these discussions more regularly than just EOFY and leverage their capabilities to the advantage of your business. If you would like our i3 Group consultants to expand on any of these answers and put them into context for your business, contact us today.
Interested in more essential payroll advice? Check out our master guide here!