In our previous blog, we talked about the second ingredient that you, as an SMB owner, should consider when reviewing the financial reports for your business – which was ‘Tracking Expenses.’ Now in this blog, we will delve into detail about the third ingredient to consider which is, ‘Accounts Receivable.‘
By definition, accounts receivable is the amount that is owed to a company by its customers. It is the sum of unpaid invoices, and is an important line item to note on your financial reports, Accounts receivables, like cash, are considered assets. However, unlike cash, high amounts of accounts receivables are definitely not considered good. If your company’s accounts receivable balance is large, that means you have a lot of money owed to you by your customers. A sharp increase in the accounts receivable line item on a financial can certainly be a likely indicator that the company is issuing credit to riskier customers.
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In our previous blog, we talked about the first ingredient that you as an SMB owner should consider when reviewing the financial reports for your business – which was ‘Profits’. Now in this blog we will delve in detail about the second key ingredient to consider which is ‘Expenses’, and why it is important for you to keep track of the expenses in your business. As it is rightly said that:
Expenses are not something to ignore or to add-on at the end, it is something to keep a track of from the beginning!
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The monthly financial close process is a daunting task for many small and medium businesses (SMBs), as it consumes many hours to double-check data and formulas, fix mistakes and consolidate multiple spreadsheets into a final set of financial reports. For many SMB’s, this process is all done manually which really extends the amount of time it takes. As a result, the chances of errors are relatively high which can result in severe consequences for an organization.
In this blog, we will highlight a few tips every SMB owner can follow to ensure an efficient and successful month-end close.
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