Investing in Your School's Financial Health
This year, as you consider operational goals to improve your educational services, you should also be considering financial goals to improve your business. Financial health and quality programming go hand-in-hand. It is not possible to operate an effective school, support teachers and managers, and invest in your business without being strong financially.
Here are a few tips to get you started:
Outsource financial statement preparation. Few educational business owners have a background in accounting, so invest in a bookkeeper or CPA to produce regular financial statements for you.
Format for meaningful analysis. Tell your production resource what format to use so that your information makes sense to you. For instance, itemize and group all staff-related expenses, programming costs, facility costs, administrative costs, etc. HINGE has developed our own model—studying financially healthy educational organizations for more than 30 years—that itemizes a school’s typical expenses and related standard costs. We’re happy to provide it to you!
Timely information. You should receive your financial statements within 1-2 weeks following the end of the period. The world changes too quickly for it to do you any good at a later date!
Produce 13 four-week financial statements instead of monthly. It is a challenge to produce completely accurate monthly financial statements due to the complexity of calculating staff costs and accounts receivable in the middle of a tuition week. We find it much more consistent and useful to produce 13 financial statements that run a four-week course. Your bank will end your statements on a four-week basis if you ask, and your production resource will easily manage this timetable.
Use the information! None of this matters if the information is not used to make better operating decisions. Connect with a bookkeeper or CPA that can simply explain the information, knows what industry standards are in each category, share and discuss the information with your managers and key team members, and make adjustments to more closely align your school for financial health.
For more advice on achieving financial health for your school and growing your childcare business, please feel free to contact us at email@example.com.
Wishing you a happy, financially-healthy 2019!