Accurate Accounting Doesn’t Always Solve Cash Flow Problems
I recently completed a new bookkeeping certification that focused heavily on traditional accounting methods. The deeper I got into the material, the more it confirmed why so many of the small business owners I work with still feel stressed about cash flow even when they arrive with accurate books.
It’s because most accounting systems were never designed to help someone decide what to do next Tuesday or next month. They’re designed to record what happened in the past and provide financial information for taxes, lending decisions, and external reporting.
The reports can be accurate. The accounting can be correct and you, as the business owner, can still feel stressed about cash flow. That’s not a you problem. That’s a visibility and clarity problem…and we can fix that.
The Questions I Couldn’t Stop Asking
As I completed the certification, I kept asking myself how these traditional reports would help a small business owner decide:
- what they can actually do with their money today while also preparing for the future?”
- how much can they safely pay themselves?
- if they can afford to hire help?
- if they should make that purchase?
- how to set money aside for taxes?
- if they can take a vacation without creating financial stress later?
- how to create a strong financial foundation?
These are the types of questions I hear every day from small business owners. Yet many traditional financial reports aren’t designed to answer them. They are designed to tell business owners what happened in the past. But small business owners who want to solve their cash flow problems need to have a financial system that allows them to easily plan for the future instead of solely focusing on the past.
There’s A Gap Between Accurate Accounting Numbers and Solving Your Cash Flow Problem
And that’s the gap my work is designed to fill.
I help small business owners get financially organized in a way that makes sense to them, understand their cash flow, and be able to make decisions with confidence.
We create visibility around cash flow and build a plan for owner’s pay.
We prepare for slower months before they arrive. We create systems that help you understand how money flows through your business.
Most importantly, we connect your business finances to the personal life they’re supposed to support because business and personal finances are intimately intertwined.
Most small business owners don’t stay up at night wondering whether their books follow traditional accounting standards.
They stay up wondering whether they’re making decisions with their money that will negatively impact their future.
They wonder if they’ll be able to pay themselves next month.
They wonder why they work so hard yet still don’t feel financially secure.
They wonder when all of their hard work will finally start feeling easier.
Accurate books are important.
But accurate books alone don’t create clarity.
A financial system set up in a way that makes sense to each small business owner creates clarity around what’s currently happening with their money and what needs to happen in the future.
And clarity is what helps small business owners move forward and grow their business with confidence, without cash flow problems.
Want help creating a personalized financial system that allows you to understand your cash flow?
Amanda Brink, financial coach and founder of Mindful Money Studio, works with individuals, couples and small business owners who want to organize and understand their finances in a way that makes sense to them, so they can stop stressing about money once and for all.