Blog from the Bridge

IRONIC FAITH

this is a philosophical position adopted by those who believe in their business model but also believe its naïve and dangerous to believe in accountants and professional advisers. Their inner prophet [ profit ] sets up an implacable psychological drive to reshape the world according to the individual’s own inner necessity. Their problem solving strategies largely revolve around avoidance and a total lack of analysis of the fiscal situation. Lots of hand wringing but little to staunch the inevitable losses. So lets look at some of the early warning signs of a business under stress: reduced working capital, blown outRead more...

‘let my silences become more eloquent’

you should never expect your end of year financial statements to be an accurate depiction of your business performance especially if they were prepared as part of the tax fight each year. Let me point out some very obvious problems with ‘tax accounts’: 1. tax values permeate right through these reports in terms of stock values, depreciation rates, special deductions etc 2. the accounts inherently try to use every means possible to minimize net profit [ within the law] to reduce the consequential tax cost 3. Balance Sheets do not reflect market or realistic current values for assets Even whereRead more...

If you’re going through hell, keep going.

that quote from Winston Churchill is quite chilling but meaningful personal growth rarely occurs without anguish, crisis and loss. Sometimes in business the only way forward is deeper into crisis. How often are insolvency experts called into a company in distress and it takes teams of forensic accountants weeks to work out the debts. How could you let a business get into that catastrophic situation ? I know all about stress, working huge hours 7 days a week for months on end. In the early 1980’s we worked for years building our accountancy business …..thank goodness for a supportive family,Read more...

Fra Luca Pacioli 1494 ‘De computis…..

the origins of accountancy and double entry bookkeeping are to be found in the 15th century Venetian monk who underpinned the commercial success of the Italian merchants with his ideas. Pacioli’s seminal work used the recently developed printing press to disseminate his concepts to a very wide audience. He used Hindu-Arabic numerals not the cumbersome Roman symbols in his encyclopedic works. Pacioli’s work morphed into what we now understand is the accountancy profession. But as Robert F Kennedy once said ” …it measures everything….except that which makes life worthwhile”. Accountancy does not measure the health of your children, the quality ofRead more...

The Important Business Planning steps

1.get your professional consulting team right 2. clarify your VISION 3. describe your end game 4. drill down and work out where you are now 5. work out how you will close the GAP between where you are NOW and where you would rather be 6. look at different strategies for MARKETING, FINANCE, PRODUCTION and your PEOPLE 7. set down a timeline with specific milestones so you can measure progress towards your goals [ set up KPI’s] 8. have a clear EXIT strategy Finally, re-read point 1 again. Your team should incorporate a professional who is well versed in communication/psychologyRead more...