The new financial year is a good time to pause and review
How have the past twelve months gone for your business?
It’s also a great time to look for ways to plan and forecast the coming months ahead.
We’ve put together some guidance on how you can utilise Omnis Group to review the previous financial year and prepare your business for the year ahead.
Review the past year
The beginning of a new financial year is a good time to review what worked and what didn’t in the previous year. You can use either a dashboard for a quick performance snapshot of your business or a report for deeper insights. Ensure you review important metrics such as:
- Did your business grow or contract?
- How are sales trending?
- What was your level of expenditure?
- How did you measure up against your KPIs?
- How did revenues and profits compare with the previous year?
You should have clear understanding of how your business has changed since the end of the previous year. If it’s grown, what can you do to continue that growth? If it hasn’t, what were the reasons?
Determine KPIs and goals for the new financial year
Review your goals and KPIs from the last year and ask yourself what your goals and aspirations are for the coming year, don’t just presume they are identical. They could include: expansion; hiring more staff; increasing business from current clients; saving for a home; or increasing your retirement savings.
Look at what could impact your ability to achieve your KPI’s and how you measure your performance against them. For example, one goal could be to achieve $100K of income per month. This data is captured in accounting software, but what contributes to your making (or not) this income goal?
You can break down the goal into contributing factors and then determine what data you need to capture to measure those. That way you can clearly measure your KPIs and receive informed advice on these (just ask us if you need a hand).
Discuss the impact of any new legislation on the new financial year
We recommend being across any new legislative changes that can impact your business. For example the Single Touch Payroll changes for the new financial year could make life more complex for small businesses. How does it affect your business?
You can reinforce the impact of legislative changes by incorporating them into the ‘recommendations for action’ section of your financial report. Any reminders that relate to these changes can be captured in this section throughout the year. This is a great way to keep the changes front of mind.
Cash is the lifeblood of any business. Consider incorporating any legislative changes into a cash flow forecast so you can visualise the impact to your business over the coming year. If these changes cause cash flow strain, we can run multiple scenarios to see how they could be alleviated.
The beginning of a new financial year is also the perfect time to examine if your business can track its finances more efficiently. Take a look at how you currently handle your money and investigate what processes and technology you could adopt to improve it. What are some systems or processes that might resolve areas of concerns you have identified when reviewing your financials? You should consider things like:
- Are you using online accountancy software?
- Are you capturing bills, receipts and invoices digitally?
- Are you struggling to get paid on time?
- Are you tracking your staff’s time?
- Are you keeping track of stock levels?
- Are your customers happy?