Staff make mistakes. Staff cut corners. And many staff simply don’t yet understand the best way of doing their job.
If the data entered into your system is poor then your reports will be inaccurate, misleading or meaningless. The three biggest areas of concern that lead to poor financial and business reports are:
1. Staff Don’t Understand (or care about) Accounting
Any reports you create, especially those led by your finance or accounting team, will aim to give you information to make better decision about your business.
For this to be accurate your staff need to understand how the data they input impacts commercial factors and ultimately how cutting corners and making mistakes will impact the meaning of the final report, and therefore the decisions made with it. Who knows, it could be the difference between a pay rise and them losing their job?
Have you ever asked your staff if they understand the difference between profit and turnover? How VAT works? Or the importance of cash flow?
2. Your Coding Process is Wrong
If you’ve never sat down and properly planned out the structure your accounting system with reporting in mind then it could be significantly better.
Have you thought about the key areas of your business that you need to know about? The areas that you need to make decisions about? The areas that mean whether you succeed or fail?
If you don’t know this then how will your staff code things correctly, especially if there are any grey areas? The failure to create a structured coding process will be a vital part of making your reports accurate and meaningful.
3. Your Reports Aren’t Set Up Correctly
Considering points 1 and 2, the chances that your reports are set up in the way you need them are very low. What’s more is that your business will have changed since they were originally set up – have you ever considered updating them or improving them?
A well-structured report should not only be accurate but it should be easy to create and distribute to anyone that needs it. Great reports are the difference between good and great businesses. They don’t guarantee success but they the key decision makers every chance of making great decisions.
Time to take action.
To help you understand exactly how to tackle this problem including how to train your staff, how to set up your GL structure, how to correct mistakes and how to set up powerful reports, we have lots of training resources available including our popular User Guides.