Financial Tip for 2016!
Start the New Year by investing in your school’s financial health! As you are considering operational goals that improve your educational services, also invest in producing regular financial statements with the goal of better managing your business. Financial health and quality programming go hand-in-hand since it is not possible to operate an effective school, support teachers and managers, and invest into your business without being strong financially. Consider the following:
- Outsource financial statement preparation. Few educational business owners have a background in accounting, so make the financial investment into a bookkeeper or CPA to produce them 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. The team at Hinge has developed a format that we love so let us know if you would like to use it!!
- Timely information. You should receive your financial statements within 1-2 weeks following the end of the period. The world changes too quickly to do much good at a later date!
- Produce 13 4-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 have found 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 also simply explain the information, learn what industry standards are in each category (we can help!!), share and discuss the information with managers and key team members, and make adjustments to more closely align your school for financial health.
Wishing you a happy, financially-healthy 2016!!!