Xero Accounting Gold Champion Partner
We hope you enjoy reading the blog post.
If you want our team to do your accounting or tax for you click here.

5 Critical steps to truly understanding your business

understanding your business

Claiming ignorance is no longer an acceptable excuse for the lack of performance of your business. Business owners need to start taking ownership of their business’s success or failure and the only way to do so is to truly understand their business finances…

As I engage with new customers and ask about their books and finances, most answer that they are not numbers people and do not understand accounting. This is obviously the easy answer and always a clear indication that

  1. They have never had an accounting firm take the time to train and educate them around basic financial management, and/or
  2. They do not want to take ownership themselves for the performance of their business as it is much easier to claim ignorance as an excuse.

But I am here to tell you that you no longer need to hide behind either of these anymore!

“Know your numbers! It’s a fundamental precept of business!” – Bill Gates


If cash flow constraints, over-expenditure, and the lack of enough time to grow your business sound familiar, you can make massive headway by following these 5 easy steps.


Think of a budget as the backbone of your finances. Without this basic guide for your day-to-day and core business expenses, the future of your finances can fall flat.

It enables you to plan your finances, predict future scenarios, and measure what you have spent against what you have planned.

You can now have a clear indication of where you go wrong and what you have been doing right.

Cash flow

You plan every other area of your business, why not plan and control the flow of finances in your business?

By using trends and knowledge of customer receipts and supplier payments, you can set up a cash flow forecast.

Having a set plan means that you can be prepared for all unforeseeable expenditures. No more surprises when it comes to taxation and other legal compliances. Stock purchases and project planning will be so much easier.


How often do you engage with the people managing your finances? I am not talking about your bank balances, knowing your financial data is what is important.

We are living in the technological era which enables you to hold your finances in the palm of your hand. It is as easy as opening your mobile device thanks to the wonder of cloud accounting.

You need to know what’s cooking in your books and know when to ask relevant questions. You need to be more involved in your business.


You need to have a game plan!

Discussing data acquired from the budget, cash flows and past trends is crucial. You will have a clear idea of when to save for a rainy day or when to stock up on inventory and resources needed for the coming peak seasons.

Your finances will be more controlled, you will know what to expect, and give your finance team relevant data to report on.

Be prepared

No more over expenditure and time-wasting as you control the outcomes. This requires you to continue learning and understanding what is going on in your business.

As your business keeps growing you will need these tools to ensure that you stay ahead. Being prepared for what’s next can now be easier than ever and you do not have to be a finance guru to be able to do that.

Do not be left in the dark. Take charge of your future and take the leap into understanding your finances and your business.

I would like to encourage you as a small business owner to follow our topics in the coming weeks as we will be showing you how to work on these key areas



Thrive CFO

Thrive CFO

At Thrive CFO, we do accounting, tax, payroll and consulting. But we don’t really DO them…

Instead, we DO FREEDOM.

Freedom of time, money and location.

Yes, tell me more!

Business Profitability Toolkit

Are you looking to improve your business’s profits?

With our toolkit, you’ll have access to a step-by-step guide and much needed worksheets that will help you identify areas for improvement and increase your profitability.

Don’t miss out on this opportunity to take your business to the next level. Try our toolkit today and start seeing results.

"*" indicates required fields

This field is for validation purposes and should be left unchanged.

Are You Thinking of Changing Accountants?


Don’t miss out on this valuable resource! Fill in your email address below to receive your free copy of ’10 Reasons to change accountants’ now.

"*" indicates required fields

This field is for validation purposes and should be left unchanged.