Entrepreneurial Accounting Leadership

Entrepreneurial Accounting Leadership

When a business expands, so does its financial management and accounting requirements

Here’s a typical start-up challenge: An entrepreneur starts a business and purchases QuickBooks to handle basic general ledger and financial reporting.  Then, when the task becomes too time-consuming or complex, the entrepreneur hires a receptionist or office administrator to handle the accounting.  Invariably, the administrator reaches his or her limit in terms of expertise or bandwidth, so the entrepreneur hires a part-time bookkeeper or entry-level accountant.

At every juncture, the entrepreneur spends time to get this new employee up to speed on the books.  It goes without saying that this is not the most effective use of his or her time.

Then at some point, one of the entrepreneur’s advisors—perhaps a CPA, lawyer, banker or other sources–says that the business needs to “grow up” and handle the accounting operations appropriately.

That’s where Capital CFO comes in. 

Capital CFO provides the following services to start-ups and entrepreneurs:

  • Develop accrual basis financial statements to support financing requests.

  • Examine of the general ledger and consolidation of expenses by “thought units” – for example Compensation & Benefits, Travel & Entertainment, Marketing, Technical Costs, Office Expenses, and Corporate Overhead Expenses so the entrepreneur can easily understand the company’s expenses structure.

  • Create monthly financial statements to enable the entrepreneur to understand the monthly and seasonal fluctuations of the business.

  • Segregate expenses so the entrepreneur can easily track EBITDA.

  • Identify and track key business metrics that are critical to the business model.

  • Train the accounting personnel to complete their jobs more effectively and efficiently and to easily maintain this information.

  • Review all of this information with the owner to improve his/her knowledge of the financial health of the business.

  • Coordinate the communications between the entrepreneur and the CPA to ensure that both individuals understand the issues that could significantly impact the business.

  • Prepare the information necessary for the CPA to complete the various business tax returns.

  • Develop annual budgets and periodic forecasts.