Why Accounting team is crucial for your business success?
As a company starts earning big bucks, they hire more and more people in various departments such as sales, operations, customer care etc. However, most companies conveniently ignore their accounting department. The accounting is the lifeline of every company and it impacts all the departments. More often than not founders find themselves in a tough spot because of disregarding the accounting department.
The accounting department is a crucial factor in deciding the success story. According to Indian business magnate Mukesh Ambani: Data is the new oil, more and more people are investing in data to enhance their business growth. Founders and investors will have problems while investing if their accounting and finance team is incapable of providing them with accurate data. The accounting department can’t be expected to provide high-quality data on time if they are understaffed. Inaccurate data will steer away big-ticket investors from investing in your company. Additionally, it can hamper the decision to launch an IPO.
Imagine you invest in a company based on their financial data but re-evaluation of it by your accounting department reveals that there is an array of misrepresentation in it. You would immediately sue them, correct? The investors for your company might exhibit a similar behaviour or worse if there is an error in your data. Suing a company makes it a public record and jeopardizes the chance of potential future investments for the company.
Business decisions should always be made after analyzing the financial data so that it gives you answers to questions such as:
- How much money (liquid cash) is available?
- What is the cash burn rate?
- Where is the burn rate more?
- Source of cash flow, etc.
Some companies are forced to hire experienced professionals during a crisis to get the company back on its legs. That is a brilliant move but even an experienced professional can’t take real-time decisions if systems and processes are not in place and misrepresentation of data will make the matters even worse. It can only lead to digging a bigger hole which will devour your company. Experienced professionals must be supported by right and scalable technology to ensure that they become a helping hand in the desired growth of your company.
There is an old proverb: Prevention is better than cure. Why should you wait until the situation becomes worse? The best thing to do is to hire more people in the accounting and finance department. The accounting team is very important for your company’s growth. Although increasing the headcount is a part of the solution, it is incomplete without integrating the proper technology for a hassle-free process. It is imperative to upgrade to Cloud ERP as the business grows and to clear the future growth path.