There are certain tasks that as a business owner, you should delegate. Bookwork is one of them – I highly recommend that you have a bookkeeper to take care of your bookwork. This could include:• Processing of invoices for both suppliers and customers
• Processing of payments for both suppliers and customers
• Processing of payroll
• ReportingDoes this absolve you of looking at your financials? Absolutely not! A mentor of mine said, “You can’t expect an outstanding job if you’re not willing to inspect”. So what should you actually check and what skills do you need to perform checks properly?
You should at least understand how to get reports out of your accounting system. Your bookkeeper should be able to show you how to do this.
You should check the following reports:
• Aged payables report (this will show you the suppliers outstanding)
So, do you need to know how to read them? Yes, unfortunately there is no easy way around this. You do need to learn how to analyse these reports for yourself. You are in business and you should not have your head in the dark about how your business is performing financially. It can all turn to sludge very quickly – some industries quicker than others. You can get yourself into debt before you know it, if you don’t pay attention.
Some of you might be saying that you didn’t “get into” business, you just “fell into it”. You just want to do your thing, not this “business of business”. I understand, because I see it all the time. If that’s the case, you need to make sure that you surround yourself with knowledgeable and trustworthy people who can help you. Why do I say “trustworthy”? Simple, if you take your eye off the ball for just a moment, a less than trustworthy individual has enough smarts to be able to fleece you. Blind trust is not an option when you are dealing with individuals. Select your team members carefully – you need to see them as an integral part of your team.
This brings me to the next step. Always pay your own bills (I know it’s a chore, I dislike it myself) unless you have the utmost faith in your designated person. Ideally the person has been working with you for some time and you have completed reference checks. You can set up your bank account so that there is a “two person” authorisation. Your bookkeeper can create the payment and then the final check and “send” can be processed by you.
As your business grows, you need to broaden your checking procedure to make sure everything is above board.
A good idea is to segregate your financial tasks amongst your team members. One person enters information, another processes payments and another reconciles the accounts. This ensures that everyone is checking in with each other.
Always remember that your business is YOUR responsibility, not your bookkeeper’s, not your accountant’s, yours. Of course, they can guide you and educate you but the buck stops with you.
What if you have an assistant either virtually or in person? How do you manage to assign tasks that relate to purchasing goods and still keep a close eye on what’s happening?
The answer is credit cards, particularly in their name on your credit card account. Ideally each card transaction is shown separately, allowing you to keep tabs on purchases being made. If you’re not comfortable with this arrangement, you could have your assistant make payments and submit expense reimbursement forms. Not all assistants are financially viable enough to allow for this arrangement so that too can determine the method used.
In summary, you do not need to know how to do everything, but you need to know enough so that you can “inspect” what is being done and know where your business is at. Don’t delegate and think you can forget about it, you need to check your results. So, as well as the saying, “Always be marketing”, I have another – “Always be checking”!