Conducting Financial Reviews

Conducting Financial Reviews

Money | Posted by - February 12, 2014 at 12:00 am

It is important to review the financial performance of the business on a regular basis. This is a fixed agenda item that is recommended as a topic in every monthly mentoring meeting.

When you discuss the financials, consider the changes from previous months and how the changes relate to the progress made on achieving the overall business goals and to projections.

  • What did you do differently this month that resulted in a surplus or shortfall in sales?
  • What did you do differently this month that resulted in more or less earnings than projected?
  • Are your targeted gross margins being achieved?
  • What sales trends are emerging? How can these trends be capitalized upon for increased revenue?
  • What other marketing efforts might be considered to boost revenue?
  • What actions are you considering to improve future financial performance?

Annual Financial Review

As part of your annual business plan review, you will also review your company’s finances. The Financial-Review Template is a simple worksheet that will assist you in completing this task. You can use and adapt the Financial-Review Template to the needs of your business and it can be found in CYBF’s Business Resource Centre.

The Financial Review Template has formulas built in to calculate key ratios and a section to enable easy planning for future years. This provides a good overview of the key areas to discuss when reviewing financial information and includes comparisons to projections and potential questions related to marketing, accounts receivable and inventory.

When completing a financial review, the entrepreneur should lead the discussion by doing the following:

  • Begin with an overview of the business’ performance relative your goals or projections;
  • Identify 3-5 areas of interest – where the business either outperformed objectives or under performed;
  • Discuss the underlying reasons for the performance so it can be repeated or enhanced for stronger results or problem solved for disappointing results;
  • Revise expectations or projections for the next review. Focus primarily on short-term results in the early days of your business; and
  • Invite questions or input from your mentor throughout the discussion.

Tags: annual, cybf, financial, management, money, review, tool

Neil steffler
March 6, 2014 at 9:31 am
If your business is to succeed you must understand you financials, you also must monitor your assets such as equipment, inventory, supplies this is a area all to often left for the balance sheet and accountants , and business owners all to often don't keep track of during the year or ever , this is a area that can break you. So count the paper clips, the bolts , how much gas your service vehicles are using ( they maybe to hard on fuel, very costly) monitor employee's work habits, I had a employee whom my manager timed in the wash room for a week he spent 2.25 hours in their ,on my dime, an other employee was on his company cell phone to his wife on average for 3 hours a day , no wonder his overtime was getting out of control ! leave nothing to chance and remember its your money and it adds up fast and small items can break you and when your on the outside looking in you don't want to be saying I wish I would have, "GOOD LUCK"
Faith Chipman
March 27, 2014 at 1:12 am
Great. Printing off and referring back to-thank you for posting.
Faith Chipman
March 27, 2014 at 1:13 am
Oh----and I thought it 'cute' that this post about financials didn't receive as many posts compared to others that were posted. *small chuckle.
April 3, 2014 at 10:37 am
nice article
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