Financeheads Blog

I am not going to claim to be an expert gardener but I do love my garden and strive to take care of it the best I can. As well as calling in experts when needed I also have various gadgets to make some of the jobs easier – none of them very expensive (I could probably afford to replace the spade) but it makes sense to keep them safe.

Businesses have assets in the form of their people, tools of their trades and potentially stock – all should be taken care off. In the case of physical assets this may involve tracking the financial value and securing with a lock and key. In my experience people are better kept safe through financial reward, training and a good working environment.

One element of the role of a Financial Director is safeguarding the assets of a business, and advising on the appropriate tools to do. And your staff don’t need to be in fear – we don’t suggest locking them up.

How would you rebuild a house after destruction from an earthquake? Would you rebuild exactly how it was initially built before the event?

What does this look like with a real business situation?

Unfortunately real life is made of failures and situations where the only solution is to rebuild from the foundations.

In financial language this is called zero-based budgeting.

It consists of a very detailed exercise of how the company functions and how financial success can be achieved through planning from what is left after the previous losses. This approach takes the view that any business activity must be measured and any cost must add value to the business before being approved.

In the end how did countries like Japan and Germany become World economic powers after being destroyed during Wars?

If you want to know more how your business can benefit from a Finance Director applying the zero-based budgeting approach to your business, do not hesitate to contact me.

Matteo Turi FCCA

Chartered Accountant and Finance Professional

Skype : matteo.turi

Tel. +44/(0)7915/202111

Last week I was approached by a company very proud of itself. They have doubled sales in the last 2 years and they are going to increase their sales six-fold in their next 24 months. This is a really successful commercial story.

Except that they are in trouble with funding…They have tried to extend finance facilities but the banks will not lend due to their….financial ratios and the….funding gap. Therefore their commercial expansion plans will now suffer….

Hang on a minute…. Commercial expansion? Short of funds? Can these both happen at the same time?

Of course they can. To be truly successful, a company needs not only to be commercially successful (which means it needs to increase sales) but it also needs to be financially successful (which means to generate cash).

Achieve commercial and financial success for your business and call your part-time Finance Director now.

I was struck afresh the other day by how much we can each take our own skills for granted. How often have you been struggling to do something with a mobile phone and someone under the age of 20 has come along and fixed it for you in seconds?

The great thing about outsourced services is that small businesses can have access to the services of a specialist without taking on a full time permanent resource. We may not be able to sort the mobile phone challenges but the great thing about being over 20 years old and having extensive finance experience is that we can look at numbers and get to the heart of the problem in the blink of an eye.

Within FinanceHeads we value the range of different expertise  our members offer, and our clients benefit from the insights we can provide directly or through the network.

Written by: Caroline Billington from a-count-a-bility
Website URL: www.a-count-a-bility.co.uk
Email address: cb@a-count-a-bility.co.uk
Landline: 01635 826124
Mobile: 07954 440241

…..and therefore time is something that should be measured – after all, what gets measured gets done. There are two areas of time (amongst others) that I frequently address with clients:

• Time spent on gaining new clients. Is it really worth a day trip to their offices to get £1,000 of work which generates £100 of profit? Oh, and have you realised that particular job only generated £100 of profit or has it got lost in the pot?
• Time spent on processes that could be made more efficient. Often documentation is the key since, as a minimum, that reduces the thinking time (What is it I have to do/How do I do it?) each time the task is done. Once a baseline is established it is also much easier to see room for improvement or even make it possible to handover the task to a less expensive member of staff.

As a part time finance director I am interested in improving the financial success of my clients and this frequently involves considering more than just the money going through the bank.