Because a factoring company wants to make sure a business is being run properly, we take a good look at a prospective borrowers financial statements. In this post Ken Kaufman, Founder & CEO of CFOwise®, stresses the importance of having bookkeeping that reflects the true accounting of the business. Poor quality financial statements are a road map to nowhere, leaving the driver totally in the dark when it comes to planning and operating a company.
Some examples he raises are; revenue incorrectly recognized, discounts buried, job costing forgotten, reconciliation dismissed, fixed assets expensed and liabilities overlooked. Read through the entire list of 20 and see if you are neglecting anything.
The most important lesson here is to reach out for professional help when you need it, and before it’s too late. A good handle on the bookkeeping of a business can reap rewards by moving in the direction of profitability and away from stagnation or destruction.