By Ritessh R Agarwal
Be it big or small enterprises, efficient financial operations, fiscal discipline and maintaining meticulous records are all indispensable for business success. This is where specialised accounting practices and financial operations management (FOM) can be crucial in driving enterprise expansion and sustainable growth.
Here are some broad guidelines to ensure efficient financial operations in diverse enterprises:
Leveraging digital solutions: Digital tools are now a global given when it comes to fiscal operations. For companies that persist with legacy ledgers and traditional books of account, accounting operations can be thrice as costly compared to digital means.
Focussing on technology tools and intelligent process automation: Customised intelligent process automation can allow accounts executives to focus on more analytical, higher-value assignments since the mundane tasks are automated and done by digital assistants. FOM platforms can intelligently implement key accounting tasks from end to end, with little or no human intervention while boosting operational efficiencies. The use of blockchain is also gaining prominence, permitting greater trust, transparency and traceability in digital transactions. Consequently, technology is streamlining fiscal workflows, curbing human errors and leading to more productive operational outcomes.
Maintaining timely financial records: Generally, small entrepreneurs tend to multitask. As a result, they have little time to maintain timely, accurate and comprehensive financial records. Professional accounting firms offer specialised knowledge to maintain a comprehensive record of all financial transactions. By ensuring timely records backed by periodic updates, a business is well-placed to evaluate its financial health regularly, track spending and discover development opportunities as and when they arise. Company leaders can also ascertain better operational performance if accurate data is available at their fingertips.
Driving strategic financial planning: With the services of accountants, entrepreneurs can make well-informed decisions that contribute to the company’s long-term financial planning. By analysing financial data and pinpointing patterns, accountants can make calculated predictions that benefit organisations of all sizes. Through close collaborations with accounts experts, company leaders could be well-placed to develop novel financial strategies that help their businesses achieve predetermined goals much faster. Such a proactive approach helps companies be better placed to grab opportunities, minimise risks and propel long-term growth.
Ensuring regulatory compliance: Adhering to complex financial guidelines can be challenging for small enterprises. Failure to comply with tax and regulatory laws can attract hefty penalties and severe legal repercussions. But accounting experts can help businesses stay on top of ever-evolving tax laws by meeting diverse and dynamic legal responsibilities. While the finance specialists handle cumbersome tasks such as financial reports and annual tax returns, the company management can devote their undivided attention to running the daily operations.
Managing costs: Judicious cost control is imperative for all enterprises seeking to maximise margins. Accounts experts can detect hidden patterns of unseen or excess spending, providing opportunities to increase monthly savings. Through a close eye on expenses and by utilising efficient budgeting protocols to eliminate wasteful expenditures, companies can manage resources better and boost their profits. Such a proactive, preventive cost-control approach helps in releasing unspent capital, which could then be spent more gainfully on business expansion or other beneficial initiatives. Cash flow management can also be streamlined through efficient cost-control practices.
Promoting enterprise expansion: Attracting investors is difficult, particularly for small enterprises. But through transparent accounting practices and the delivery of robust financial results, accounts experts can play a key role in driving investor interest. Adhering to global best practices while maintaining the accounts also boosts the trust quotient with investors and other stakeholders, creating opportunities for investments, business partnerships and expansion.
Implementing robust risk management practices: Efficient financial operations are contingent on vibrant risk management protocols. Through stringent internal controls, constant financial oversight and complete compliance with regulatory norms, enterprises are always in a position to pinpoint and eliminate or reduce potential threats. Thereby, financial losses can be limited, safeguarding the brand reputation and ascertaining long-term stability.
Adhering to annual budgets and forecasts: Efficient financial operations must be ensured based on an annual budget while working towards realising the yearly forecast of business growth. By setting realistic budgetary targets and periodically tracking the ground performance against the projections or predetermined objectives, enterprises can highlight any deviations and modify business strategies backed by calculated, well-informed financial decisions. In this way, unwanted risks can be shunned or mitigated while seizing available opportunities to achieve short- and long-term financial goals.
By following these broad guidelines, efficient financial operations can drive greater business success. Finally, in all enterprise operations, financial or non-financial, businesses must also follow Kaizen – a Japanese term denoting continuous improvement or change for the better. In an era where constant innovations and digital disruptions are the norm, continuous improvement in enterprise operations is the only way to make certain that businesses thrive over the long haul.
(The author is Ritessh R Agarwal, Head of Finance, mPokket, and the views expressed in this article are his own)
