Here are three areas/factors you need to evaluate in your accounting and finance function. I like to grade a company's accounting operation in these three categories on a scale of 1 to 10.
- Confidence Factor - This goes right to the heart of whether the people backing and supporting you financially have confidence in your numbers. You also want to determine if your management team has confidence in the financial information they receive. A lack of confidence is a big warning sign that your accounting function is letting you down.
- Insight Factor - This component takes a look at whether the information coming from your accounting and financial function is insightful or not. Most accountants don’t think in terms of really providing insight to others. Big mistake. This is an important part of how you create trust and confidence with lenders and investors.
- Accuracy and Speed Factor - The last component is focused on whether people trust the financial information you provide. Nothing kills your credibility more than providing financial information that is inaccurate or tends to bounce around and change all the time. When you provide accurate information quickly, and you do it consistently month to month, you set yourself out as a company that has its act together. Lenders and investors love it and you will forge a strong relationship with them that will last a long, long time.
Sit down with your Controller or your CFO and rate the accounting function on a scale of 1 to 10 in each of those three areas.
Then measure the progress they make in each area over the next three months.
It could be the start of something new and exciting!