The New Year makes accounting's biggest and most important fiscal period. It offers a summation of an entire year's efforts and for some will be cause to celebrate and for others, not so much.
Successful periods all deserve a thorough review to garner those actions and policies that brought about success and can then be isolated and reinforced. The year ending is for most small businesses December 31. That closes one period and the next day an entirely new year begins. It is actually a dramatic event.
That the past is the past and future bright is every business owner's thought. Of course, there is that little thing of tax obligations that can follow one into the new year, but if the past is thoroughly evaluated, it indeed can be bright or brighter. Correcting those things that failed or made the year a mess is crucial to improvement. This is as much a part of a new brighter year than accenting those things that succeeded.
Reflection is important and add to it evaluation. That asks the questions " what is important? " or "how does it effect my business?" To evaluate is to glean understanding and importance out of what is being reflected upon. With that new understanding the future can be planned and budgeted.
Yes yes, budgeting is dry stuff but consider it the curbs on the road keeping the fiscal car from jumping left or right. A good budget created with understanding from well evaluated data can make or break success. The best tool for Projection is Reflection and add to that Evaluation.
As the New Year begins, evaluate the past performance and alter the future projection by instituting good changes. This can be done in great detail including evaluation of vendors, employees, pricing, policies, benefits, cash flow, inventory and more. Bigger businesses would have managers dong this and feeding their findings up for further evaluation and coordination. It is paramount that all information be factual. False reports kill companies so when you discover someone falsely reporting, kill them first by kicking them out the door. Anyone who covers up needed facts is not your friend but rather an enemy within. Act without regret.
So with this New Year, Reflect and Project and Evaluate. I am always available to assist.
HAPPY NEW YEAR!
Donn Marier
DM-Your Own CFO