When does a growing business need more finance support?
Recognise when your business needs better reporting, cash forecasting or financial decision support, and understand whether a project or ongoing advice would help.
10/15/20263 min read
When does a growing business need more finance support?
A growing business may need more finance support when its reporting no longer helps the owner understand performance, anticipate cash pressure or assess an important decision. The appropriate response could be a defined improvement project, regular advisory support or a more substantial finance role, depending on the work required.
The starting point is to identify what information or expertise is missing. That makes it easier to choose support that fits the business and works alongside the people already involved.
Signs your current reporting needs attention
Three signs are worth examining:
Reports arrive too late to influence decisions.
Cash shortages recur without enough warning.
Hiring, pricing or expansion decisions rely on figures the owner cannot confidently explain.
Bookkeeping and year-end accounts provide an essential foundation. As the business becomes more complex, management also needs timely information about margins, customer payments and upcoming commitments. Sales may be increasing while cash remains tight because stock and wages are paid for before customers settle their invoices. Understanding that timing helps the owner assess whether further growth is affordable.
What decision do you need help making?
Consider a business planning to recruit another employee. The owner needs to assess the full employment cost, the work the person will undertake and when the additional capacity is expected to generate income.
A forecast can show how those assumptions affect cash and what happens if demand develops more slowly than expected. It should draw on reliable information, make the assumptions clear and be updated as circumstances change.
Other questions require different work. Margin concerns may call for an analysis of pricing and costs. Late reports may require a better monthly timetable and clearer responsibilities. Defining the question helps keep the engagement focused.
Do you need a project or regular support?
The type of support should reflect how often the need arises and who will take responsibility for the work.
A defined project may suit a specific need, such as reviewing reporting or controls, developing a cash forecast or assessing an investment. Agree the output, timetable and completion point before work begins.
Ongoing advisory support may be useful where management needs regular help interpreting monthly performance, reviewing forecasts and assessing decisions. Agree the frequency of meetings and the support available between them.
A fractional finance role involves responsibility for agreed parts of the finance function. This requires sufficient time, authority and access to systems and people, with clear boundaries around staff management and producing financial information.
A project can have a clear completion point. Regular support requires an agreed pattern of work and review. Where the role involves managing staff or producing financial information, those responsibilities need to be expressly included in the scope.
How will this work with your existing accountant?
Establish what your accountant, bookkeeper and internal team already provide. They may offer the additional support required or work alongside an adviser with a different remit.
Agree who prepares and checks the figures, who maintains the forecast and who explains changes to management. Clear responsibilities reduce duplication and help prevent important tasks being overlooked.
What should you agree before work begins?
An engagement should set out the problem being addressed, the work to be completed and the information the business must provide. It should also explain the timetable, fee, meeting arrangements and how additional work will be agreed.
If reports are incomplete or records need correcting, establish who will resolve those issues. This can materially affect both the work required and the time needed. An initial review may help define the scope where the extent of the problem is uncertain.
Discuss your reporting or finance support needs
V&E Kaiulo supports established businesses with cash visibility, management reporting, financial controls and decision-making. Depending on the need, this may involve a defined review, financial modelling, implementation support or an ongoing advisory relationship.
We agree the scope, responsibilities, timetable and fee before work begins, working alongside existing advisers and internal teams where appropriate.
If your current information is making a business decision difficult, contact hello@vandekaiulo.com to discuss the question and what support would be useful.