Oana Labes, MBA, CPA on LinkedIn: #entrepreneur #finance #business | 52 comments (2024)

Key Performance Indicators (KPIs) play a crucial role in finance by providing measurable metrics that allow organizations to assess their financial performance and make informed decisions. Here are several reasons why KPIs are important in finance:Performance Measurement: KPIs serve as objective measures to evaluate financial performance. They provide insights into various aspects of financial health, such as profitability, liquidity, efficiency, and solvency. By monitoring KPIs regularly, organizations can gauge their progress toward financial goals and identify areas that require improvement.Goal Setting and Alignment: KPIs help in setting clear financial goals and objectives for the organization. Finance teams can align their efforts with broader organizational objectives by defining specific KPIs, such as revenue growth rate, return on investment (ROI), or working capital ratio. KPIs provide a roadmap for success and enable tracking of progress towards these goals.Decision Making: KPIs provide valuable information for making data-driven decisions. By monitoring relevant financial KPIs, finance professionals can identify trends, patterns, and potential issues early on. For example, if the KPIs indicate declining profitability, management can take corrective actions, such as cost reduction or pricing adjustments, to address the issue promptly.Performance Benchmarking: KPIs enable organizations to compare their financial performance against industry benchmarks or competitors. This benchmarking provides insights into relative strengths and weaknesses, highlighting areas where improvement is needed. It helps in identifying best practices and areas for operational efficiency, which can lead to better financial outcomes.Investor Confidence and Stakeholder Communication: KPIs play a crucial role in communicating financial performance to investors, shareholders, and other stakeholders. KPIs provide a standardized language and metrics that stakeholders can use to evaluate the organization's financial health and potential. Transparent and well-defined KPIs can enhance investor confidence and facilitate effective communication between finance teams and stakeholders.Performance Evaluation and Incentives: KPIs are often used as a basis for performance evaluation and incentives within finance departments or organizations as a whole. By setting relevant KPIs and linking them to individual or team goals, organizations can motivate employees to align their efforts with desired financial outcomes. In summary, KPIs are essential in finance as they provide quantifiable measures to assess financial performance, set goals, make informed decisions, benchmark against industry peers, communicate with stakeholders, and drive performance improvement. By leveraging KPIs effectively, organizations can enhance their financial performance and achieve long-term success.#keepgrowing #kpi #finance

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The Finance Process House.An overview of all the core processes in the finance function.21 processes for CFOs to master:1. Financial Planning & Analysis2. Financial Reporting3. Accounting4. Treasury Management5. Tax Management6. Risk Management7. Capital Allocation8. Financial Systems and Technology9. Cost Management10. Financial Compliance11. Strategic Financial Management12. Financial Communication13. Employee Benefits Management14. Financial Policy Development15. Vendor and Supplier Management16. Financial Education and Training17. Sustainability and ESG Reporting18. Financial Analytics and Business Intelligence19. Asset Management20. Cash Handling and Banking21. Regulatory ComplianceIt's a tough job to manage these just on a high level yet each can be divided into subprocesses that require a whole specialism in their own right.CFOs can manage these successfully without a great team to back them up.Each team is a brick which is crucial to the stability and performance of the house.If one team starts to struggle it may just impact the whole house (finance function).What are you doing to manage all these processes in your company?Do you even cover all of them?Did we miss any key processes in this overview?----------🧑💼 I'm a partner at Business Partnering Institute🆘 Need immediate help in your finance team, call us!🤝 We help increase the influence of your finance team🔔 To see more of my content, hit the bell on my profile📻 Find our#FinanceMasterpodcast on your channel📄 Check out all our templates and cheat sheets here: https://lnkd.in/eC_zuCU4

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👨💼👩💼 Running a business isn't just about profits and expenses—effective financial management is key to achieving long-term growth and success. Here are some tasks you can assign to your Chief Financial Officer (CFO) to ensure your financial strategy is on point. 1. Financial Planning and Analysis: Request your CFO to develop comprehensive financial plans and conduct in-depth analysis to assess the financial health of your business. This includes budgeting, forecasting, and financial modeling.2. Cash Flow Management: Task your CFO with managing your business's cash flow effectively. They can monitor cash inflows and outflows, optimize working capital, and implement strategies to maintain a healthy cash position.3. Financial Reporting: Ask your CFO to prepare accurate and timely financial reports, such as balance sheets, income statements, and cash flow statements. 4. Risk Management: Assign your CFO to assess and mitigate financial risks that your business may face. They can develop risk management strategies, analyze insurance needs, and ensure compliance with regulatory requirements.5. Tax Planning and Compliance: Request your CFO to oversee tax planning and ensure your business remains compliant with tax regulations. This includes managing tax obligations, preparing tax returns, and exploring tax-saving opportunities.6. Financial Systems and Technology: Assign your CFO to evaluate and implement financial systems and technology that can streamline financial processes, enhance reporting capabilities, and improve overall efficiency.7. Fundraising and Investor Relations: If you are seeking investment or engaging with stakeholders, involve your CFO in fundraising activities and investor relations. They can provide financial insights, prepare financial statements, and communicate with potential investors and stakeholders.#FinancialManagement #BusinessGrowth #StrategicPlanning #Accounting #BusinessAdvice

A finance team plays a pivotal role in the success of any business. A well-functioning team can drive financial stability, strategic decision-making, and contribute to overall growth. But what does a Good Finance Function look like? 🏆 A Good Finance Team will...✅ Take a proactive approach, consistently seeking opportunities to optimize financial performance and mitigate risks. ✅ Produce accurate and and timely data. They will ensure that financial statements, budgets, and forecasts are prepared meticulously and delivered promptly. This enables informed decision-making, fosters transparency, and builds trust among stakeholders.✅ Establish and maintain robust internal controls and compliance frameworks. ✅ Collaborate with other departments, such as operations, sales, and marketing, to understand their needs, provide financial insights, and contribute to strategic planning. This is key to cross-functional success.✅ Embrace a culture of continuous improvement. They stay updated on industry trends, emerging technologies, and best-in-class practices. They seek ways to streamline processes, enhance efficiency, and leverage data analytics to empower informed decision-making.⁉ A Bad Finance team will❌ Operate in a reactive mode, solely focusing on routine tasks and transactions. ❌ Produce inaccurate and delayed financial reporting. Their lack of attention to detail can lead to incorrect information and hinder effective decision-making.❌ Neglect to establish strong internal controls and compliance measures. They may overlook regulations, fail to identify risks, and compromise the organization's financial stability and reputation.❌ Operate in isolation, detached from other departments. They lack collaboration, communication, and fail to understand the financial implications of operational decisions. ❌ Resist change and fail to adapt to evolving business needs. They may cling to outdated processes, technology, and methodologies which will impede progress.Investing in building a strong finance team is paramount for any business. A strong finance function will enable more profit, more cash and reduce risk to the business which maximises the opportunity for growth and sustainable success.Drop me a message or email if you would like to know more...James.Lammond@YourRightHand.co.uk#FinanceTeam #FinancialReporting #SystemsProcessesControls #SME

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Corporate Finance Roadmap!Make strategic choices, allocate resources effectively, and identify potential financial challenges or opportunities. 💡👍 👍 👍 𝗟𝗶𝗸𝗲, 𝗦𝗵𝗮𝗿𝗲 𝗮𝗻𝗱 𝗖𝗼𝗺𝗺𝗲𝗻𝘁 𝘀𝗼 𝘁𝗵𝗶𝘀 𝗽𝗼𝘀𝘁 𝗰𝗮𝗻 𝗿𝗲𝗮𝗰𝗵 𝗽𝗿𝗼𝗳𝗲𝘀𝘀𝗶𝗼𝗻𝗮𝗹𝘀 𝗮𝗻𝗱 𝗳𝗼𝘂𝗻𝗱𝗲𝗿𝘀 𝘄𝗵𝗼 𝘄𝗮𝗻𝘁 𝘁𝗼 𝗹𝗲𝗮𝗿𝗻 𝗺𝗼𝗿𝗲 𝗮𝗯𝗼𝘂𝘁 Corporate finance.🚀 𝗛𝗲𝗹𝗽 𝗺𝗲 𝘀𝗵𝗮𝗿𝗲 𝘁𝗵𝗶𝘀 valuable insights and forecasts!▶ 𝗪𝗛𝗔𝗧 𝗜𝗦 𝗜𝗡𝗖𝗟𝗨𝗗𝗘𝗗 𝗜𝗡 𝗧𝗛𝗜𝗦 CORPORATE FINANCE ROADMAP:• Financial statement• Ratio analysis• Revenue projection• Cogs planing• Overhead variable forecast• Overhead fixed forecast• Net working capital forecast• Financial liabilities forecast• Capex and A&D forecast• Wacc calculation• Breakeven analysis• Balance sheet forecast• Profit & loss account forecast• Cash flow forecast• Vertical analysis• Horizontal analysis• DCF valuation---------------------👉 By engaging with this post with likes, reposts or comments, you canhelp increase the visibility. If you find the information useful, leave a like or comment.Start collecting my resources and models about financial forecasts, projections and estimations.Did I miss something? Let me know what you would add, and I will approach that in the new version. 😀👉 𝗟𝗶𝗸𝗲, 𝗖𝗼𝗺𝗺𝗲𝗻𝘁, 𝗥𝗲𝗽𝗼𝘀𝘁.-------------------------"You can't predict the future, but you can create it" P. Drucker. Use my 𝗖𝗼𝗿𝗽𝗼𝗿𝗮𝘁𝗲 𝗙𝗶𝗻𝗮𝗻𝗰𝗲 Modeling Package and start creating your financial health today.https://lnkd.in/dZwwg6Wj➕ 𝗙𝗼𝗹𝗹𝗼𝘄 𝗺𝗲 for more finance, accounting, reporting, M&A, IFRS and valuation 𝗙𝗥𝗘𝗘 𝗿𝗲𝘀𝗼𝘂𝗿𝗰𝗲𝘀.#finance#financemanagement#corporatefinance#balancesheet

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The Heart and Soul of Your BusinessIn the realm of business, every entity possesses a heart and soul that drives its success. For many companies, this vital essence resides within the accounting and finance departments. This often-overlooked division plays a pivotal role in the financial well-being of an organization.The accounting and finance department serves as the financial compass, providing invaluable insights and information to managers and decision-makers. Armed with this knowledge, businesses can navigate the complexities of the market, make informed decisions, and steer towards growth and profitability.In today's fiercely competitive business landscape, having a robust accounting and finance department is paramount. These professionals possess the expertise to analyze financial data, identify trends, and forecast financial performance. Their insights enable businesses to adapt to changing market dynamics, optimize resource allocation, and mitigate financial risks.Here are some ways in which a strong accounting and finance department contributes to the success of a business:1. Accurate Financial Reporting2. Compliance with Regulations3. Strategic Planning4. Risk Management5. Profitability AnalysisIn conclusion, the accounting and finance department is the heart and soul of your business. It is the engine that drives financial success and provides the insights needed to navigate the ever-changing business landscape. Invest in this department to ensure your business thrives, achieves long-term success, and maintains a beating heart that keeps it vibrant and competitive.#AccountingAndFinance #BusinessSuccess #FinancialInsights #GrowthAndProfitability

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Choosing a fractional controller for your business requires careful evaluation. Here are some best practice tips from Aura CEO, Brandon Kordower for your selection process:1) Experience and Expertise: The fractional controller service you select should have a wealth of experience and expertise in your industry. Ask for evidence of this, such as case studies or references from other similar businesses they have worked with. This will give you a better idea of what they can bring to your business.2) Relevant Qualifications: Make sure the professionals within the service have relevant financial qualifications. This helps to assure a high standard of knowledge and ethical practices.3) Business Needs Alignment: Determine what your specific needs are and see if the service aligns with these. Are you looking for help with financial strategy, budgeting, cash flow management, or another area? The service should be able to deliver on your primary needs.4) Scalability: Consider whether the service can scale to match your business's needs. As your business grows, your financial management needs may become more complex. The service should be able to adjust accordingly.5) Communication Skills: Effective and timely communication is crucial in finance. During the selection process, pay attention to how responsive the service is and whether they can communicate complex financial information in an understandable way.6) Cultural Fit: The fractional controller will become a significant part of your team. Assess whether they would fit well within your company culture, as this can greatly impact the effectiveness of their work and their ability to collaborate with your team.7) Transparent Pricing: The service's pricing structure should be clear and transparent, with no hidden fees. Understand what is included in the cost, and whether any additional services may result in extra charges.By following these guidelines, you can select a fractional controller service that aligns best with your business needs and is equipped to support your financial management effectively. #financemanagement #smallbusinesssupport #helpfultips #brandontruthbombs

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If you are a business owner, here are some helpful financial tips from my brother, Brandon Kordower

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The Chief Financial Officer (CFO) is a crucial executive role in an organization, regardless of its size or industry. The CFO is primarily responsible for managing the financial activities and strategies of a company, ensuring its financial health and supporting its overall business objectives. Here are some reasons why a CFO is needed:Financial Planning and Strategy: A CFO plays a key role in developing financial plans and strategies to achieve the organization's goals. They assess the company's current financial position, analyze market trends, and provide insights for making informed decisions regarding investments, cost management, and revenue generation.Financial Reporting and Analysis: CFOs oversee the preparation and analysis of financial reports, including income statements, balance sheets, and cash flow statements. They provide accurate and timely financial information to the management team, board of directors, and external stakeholders, enabling them to make informed decisions about the company's performance and future prospects.Risk Management: CFOs are responsible for identifying and managing financial risks within the organization. They assess potential risks, develop risk mitigation strategies, and establish internal controls and policies to safeguard the company's assets and ensure compliance with financial regulations.Capital Management: CFOs play a crucial role in managing the company's capital structure. They determine the optimal mix of debt and equity financing, evaluate investment opportunities, and manage relationships with lenders and investors. Effective capital management is vital for funding operations, expansions, and acquisitions while maintaining a healthy financial position.Financial Operations: CFOs oversee various financial operations, including budgeting, forecasting, and cash flow management. They ensure that the organization has adequate funds to meet its financial obligations, optimize cash flow, and allocate resources efficiently. By monitoring financial performance and identifying areas for improvement, CFOs contribute to the company's operational efficiency and profitability.Stakeholder Communication: CFOs act as a bridge between the finance function and other departments, as well as external stakeholders such as investors, analysts, and regulatory bodies. They effectively communicate financial results, forecasts, and strategic initiatives, building trust and confidence in the organization's financial management.Compliance and Governance: CFOs are responsible for ensuring compliance with financial regulations, accounting standards, and corporate governance practices. They work closely with auditors and regulatory authorities to maintain transparency, accuracy, and ethical financial practices within the organization.#financialplanning #finance #investment #funding #opportunities

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