FUNDAMENTALS OF A FINANCIAL MANAGEMENT SYSTEM
Financial management systems are not the same as small business accounting software, they should not look like a tangled mess of IT architecture and they should not include the use of spreadsheets as a cornerstone of their data and reporting handling. So what should a good financial management system include? In this article we’ve highlighted some of the core capabilities that you need to look for if you’re considering a system.
Forecast and Prepare Business Reports Quickly, While Closing Your Books Faster.
As the financial controller or CFO, it’s essential that you’re able to see your company’s financial status as soon as you’re asked by the business owner, CEO or board. Yet it’s rarely ever that simple. This is where spreadsheets and cobbled together patchworks of point solutions frequently fail to deliver the information you need when you need it. You are probably reading this article because it is currently taking you more than a few hours to compile an accurate report of vital current financial information, or you are spending several days every month on closing the books.
Financial Management Systems Vs Spreadsheets
Spreadsheets are one of the great leaps forward in business tools, however they are highly prone to errors, frequently break when they reach a certain size, get lost, renamed, duplicated across multiple systems until eventually its impossible to be sure if you’re looking at the latest information, or even if the information contained within it is correct at the date of last save.
Spreadsheets are also unable to be audited – meaning you can’t track things like who was the last person to make changes to your master data records of supplier bank account numbers, or why invoice numbers aren’t matching up.
Financial Forecasting & What If There’s A Pandemic?
Setting a business strategy and effectively planning for whatever your businesses future might hold is one of the biggest factors that assure you survive whatever the world wants to throw at your business. If you can open your systems right now and change tomorrow’s numbers to see what impact certain events will have on your business – and exactly where the flow on effect of those impacts will be felt most – then you are able to put in place strategies to minimise the impacts.
Plan for another pandemic or lockdown, losing your biggest supplier to a trade war, a flood in one of your warehouses, or losing your single biggest customer. Forecasting for the future could even be as simple as changing the price of electricity, or proactively reducing the volume of a particular commodity that goes into the manufacturing of your product. Being able to forecast both the positive and negative impact of changes to your business will help you to build business plans, secure investment, and survive the next big economic event.
What Makes NetSuite Such An Impressive Financial Management System?
For fast growing businesses it is very easy to fall into the trap of expecting your small business software, like Xero, will simply keep up with your business needs by adding another “bolt-on”. As you add another warehouse, acquire another business or launch a subsidiary, you can end up in a spreadsheet and bolt-on hairball.
NetSuite is a single system that handles your entire business, while ensuring your business adopts the leading industry practices for your industry. This ensures you’re ready for genuinely scalable growth and expansion without the bloat and the overheads.
We’ve been busy curating the most relevant NetSuite demonstration content on our YouTube channel, as well as some video based case studies, so you don’t have to hunt for the information.