The value of conversation
I am always very excited to deliver my clients their first set of management accounts. You might remember that in my last blog, I explained how at E.H. Taylors, our clients receive their management accounts each quarter in an uncluttered and straightforward report. It’s always wonderful to see all the vital information they need to promote their business’s success in one document.
However, a common issue I encounter with clients and their management accounts is a lack of conversation around these all-important reports. When clients don’t take the time to sit down each quarter to review their management accounts, they become under-valued.
My answer to discovering the full potential of your management accounts is grasping the value of conversation!
When it comes to your business finances, success won’t jump into your hands.
As plenty of you already know, it’s very easy to get caught up in your business’s day-to-day running. However, to ensure a business is profitable, you need to make time to improve it.
This is where conversation comes in. By booking a meeting with our clients to discuss their management accounts at E. H. Taylors, we ensure their reports are examined and get the attention they deserve.
Understanding the value of conversation
There are two crucial factors that make conversations vital when it comes to your business’s management accounts.
- Explanation & understanding – For many business owners, their management accounts can appear to be written in code. However, a qualified accountant knows precisely what they are looking at. A conversation allows the opportunity for an accountant to explain a business’s management accounts in layman’s terms. It also provides business owners the chance to ask any questions about their report.
- Structure and actions – As I’ve already said, management accounts provide the information to drive a business forwards, and a conversation with an accountant allows for a structured conversation that ensures no essential information is missed. With every conversation, a business owner will also have the opportunity to use the data in their management accounts to set actions in order to improve their business.
For every business, management accounts can flag up important information, including:
- Whether or not a business is making or losing money overall
- What areas of a business are making the most profit
- A businesses gross profit percentage (margins) in comparison to the industry standard
Want to see some examples of how your management accounts can help improve your business? Download a copy of my book, The Keys To The Safe.
All the information you need is in your management accounts. You just need to dedicate some time to understand your report. You can then use it to implement actions that will change your business for the better.
Stay tuned for my next blog when I’ll be talking more about action and why, without it, all your information and conversations are a waste of time!
Antony Holdsworth BSc (Hons) FCMA CGMA