This is part 2 in our series covering the MONITOR phase of the Financial Operating System (FOS) — we’re working our way from a good foundation (quality financials) up to tools for identifying and fixing business trends.
In part 1, we went all the way to the root of financial decision-making by unpacking the importance behind our accounting method choice(s).
In part 2 (today), we’ll look at a set of overarching principles for good bookkeeping (a prerequisite for meaningful financial analysis).
How to have amazing books
You need a good set of books. Period.
When working with a new member, I typically start with 2 basic questions:
Are you consistently getting financial reports on a timely basis?
Do you believe the numbers you’re looking at (i.e. are they reliable)?
Don’t worry if you answered “no” to either question, we have a helpful set of tactics coming up. For everyone else, you may find ways to make improvements.
Why this matters
No amount of financial analysis, detailed spreadsheets, guidance, coaching, etc. will help you without good financial statements. This applies to implementing the Financial Operating System (FOS) and all tools outlined in our newsletters. Consider a set of quality financial statements as a “prerequisite” for good financial management.
This advice is usually frustrating because business owners may not know what a good set of financials should actually look like.
Let’s change that…
P.S. hit the “like” button and comment “BOOKS” and we’ll send you a copy of the bookkeeping health checklist!
