What business owner doesn’t want to be profitable? Properly executed accounting not only allows you to maintain your current business, but it also can increase profitability and identify growth areas. Michelle Mahle, director of tax at SS&G, shares some advice on how accounting can make a difference.
Q. What accounting missteps might lead to decreased profitability?
A. Financial statements are a powerful resource for business owners. Knowing what information to capture, and to what level of detail, is key to making solid business decisions. Ensure that your chart of accounts suits your business and accounting needs.
Q. How can accounting help identify areas for growth?
A. Accounting, done properly, will allow you to project future results as well as report historical activity. Business forecasts can help identify opportunities for business owners to refocus, reallocate, dedicate or even restrict resources to achieve different results.
Q. What do businesses commonly overlook that can pose problems?
A. Scrutinizing expenses will improve your bottom line. However, focusing too much on your bottom line can be counterproductive. If you aren’t finding a way to maintain or increase revenues, it doesn’t matter how much you spend because, eventually, anything will be too much.
Michelle Mahle is a director of tax at SS&G. Reach her at (800) 869-1834 or MMahle@SSandG.com.