If you’re managing your business’s financial situation by keeping one eye on your bank balance and the other on your outstanding bills, you’re missing out on a huge number of insights into the liquidity of your venture.
You may be reporting year-end profits, but when your everyday cash situation is looking worrying – due to running costs, overheads and tax liabilities – it’s time to delve into the numbers and get a better handle on your cash flow.
At Tyrrell and Company, we’ve worked on valuations for many of our clients. It’s an important part of planning a growth strategy or the end sale of the business, so getting as accurate a valuation as possible is always the end aim.
And, in our experience, there are four basic criteria that have an impact on the end value of a business
If you see your advisers once a quarter – or worse still, once a year – then you don’t have the right kind of depth to your advisory relationship.
You need more frequent contact and a more productive working relationship with your accountant. By meeting and talking regularly makes a big difference between a ‘traditional accountant’ and a ‘modern cloud-based accountant’ – a good, 21st-century accountant is a trusted business adviser, not a dull bookkeeper.
Too many businesses survive with one eye on their bank balance and another on an ever-growing pile of bills to pay. They survive, day to day, but there’s no stability, no profit and definitely no foundation for growth. And this kind of short-termism can be fatal for a number of reasons: