Bookkeepers’ bamboozingly baloney?

We all know that our bookkeepers can tell us how much is in the bank; how much is outstanding from debtors and to creditors; how much was paid to the bloody accountant and other really useful things. 

But it is what they do not tell us or show us that is an alarming problem for any business owner.

Business owners may be surprised to learn that all bookkeepers produce financial reports each month. Well, they should on the same day each month for the preceding month and these should include the Balance Sheet and Profit & Loss Statement with a comparison to budget.

Normally the reports are just issued from the accounting system and I have seen some that run to 6 pages and it takes me some time (like forever) to begin to understand them. What hope for the poor old business owner? They do not have a day let alone a week to review, decipher and use these reports. And of course it is entirely possible that the business owner will not even see these reports because the bookkeeper:

• Does not show them
• Does not produce them every month
• Does not produce them at all
• Loses them and blames your dog

It is not the fault of the bookkeeper - their training and experience does not extend into these areas. This is the domain of the external accountant or business advisor (1). And these guys are  expensive so you don't want them using this time producing  monthly reports.

No, the solution is to get the bookkeeper to do more. Are they capable? Yes but not on their own. Use ME at pivotal points and maybe the mere bookkeeper can raise to the occasion.

Am I putting down the role of the bookkeeper - YES, but only to the extent of them assuming responsibilities beyond their capabilities, experience and training. They are pivotal to a business and worth their "weight in gold".

Am I elevating the role of ME - YES, but only because I am fantastically great.

Am I arrogant? Duhh...YES!

But why not, I am after all very good at what I do, not least because I am the product of 25 years of education and specific training in key business. It may also be pertinent to note that I was born possessed of an especially developed intellect although I acknowledge that this may be more difficult to pin down in the absence of friends and disaffected family members.

Oh, yes I have to also admit that I have clients who, on a favourable day may be able to comment positively.

But back to the management report. It is fair to say that it should be:

1. Produced by any bookkeeper each month in less than 30 minutes
2. Understood by the business owner
3. Useful to the business owner
4. Succinct - one page for the Balance Sheet and one for the Profit & Loss Statement
5. Contain a Budget vs. Actual comparison

How?

1. ME designs an Excel report template that contains summary data which the bookkeeper can complete from the reports issued from the accounting system.
2. Training is extended to the business owner
3. Additional information is included on key drivers or variables
4. Easy if  summary information is used. A business owner and ME can always drill down if we want to.
5. Easy, if the business prepared a budget or forecast. If they haven't see ME real quick!

ME can be wheeled in monthly or quarterly and the management report can be used as the basis of a proactive and positive meeting planning for the future.

In conclusion, all I am really saying is get the best out of the Bookkeeper and ME by understanding and respecting their roles.

1. Lets call this guy, whether a girl, bloke, automon a spade – the “Business Advisor” ok?, or if you like, “BA”, no, shit lets call it “ME”.