{"id":2202,"date":"2026-10-07T09:02:02","date_gmt":"2026-10-07T09:02:02","guid":{"rendered":"https:\/\/slacc.co.uk\/index.php\/is-your-business-relying-on-the-wrong-numbers\/"},"modified":"2026-10-07T09:02:02","modified_gmt":"2026-10-07T09:02:02","slug":"is-your-business-relying-on-the-wrong-numbers","status":"publish","type":"post","link":"https:\/\/slacc.co.uk\/index.php\/is-your-business-relying-on-the-wrong-numbers\/","title":{"rendered":"Is your business relying on the wrong numbers?"},"content":{"rendered":"<div>\n<p>Modern accounting software can give business owners access to financial information almost instantly. That does not necessarily mean they are looking at the right information.<\/p>\n<p>A dashboard containing turnover, bank balance and profit can be useful, but these figures may tell only part of the story.<\/p>\n<p>Consider a business where sales have increased by 10%. That sounds encouraging. If gross margin has fallen at the same time, however, the additional sales may be producing surprisingly little extra profit.<\/p>\n<p>Similarly, a healthy bank balance can disguise problems ahead. VAT, PAYE, Corporation Tax and supplier payments may already account for much of the cash sitting in the account.<\/p>\n<p>This is why useful management information should start with the decisions you need to make rather than the figures your accounting software happens to display.<\/p>\n<p>For example, a business concerned about profitability might monitor gross margin by product, service or customer. One concerned about cash flow could follow debtor days, overdue accounts and expected cash requirements. A business trying to improve productivity might compare staff costs or hours worked with output or revenue.<\/p>\n<p>The important point is to keep the list manageable.<\/p>\n<p>A report containing 25 key performance indicators can easily become something nobody reads. Three or four carefully selected measures, reviewed consistently, may be far more useful.<\/p>\n<p>It is also worth establishing what should happen when a figure moves outside an acceptable range. If gross margin falls below a target percentage, who investigates? If debtor days increase, when does someone contact customers?<\/p>\n<p>Management information becomes valuable when it prompts action.<\/p>\n<p>Instead of asking, &#8220;How did we do last month?&#8221;, try asking a more useful question:<\/p>\n<p>&#8220;What do we need to know now to make next month better?&#8221;<\/p>\n<p>That small change of emphasis can turn accounting information from a historical record into a management tool.<\/p>\n<\/div>\n<!-- -->","protected":false},"excerpt":{"rendered":"<p>Modern accounting software can give business owners access to financial information almost instantly. That does not necessarily mean they are looking at the right information. A dashboard containing turnover, bank balance and profit can be useful, but these figures may tell only part of the story. Consider a business where sales have increased by 10%. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[1],"tags":[],"class_list":["post-2202","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/2202","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/comments?post=2202"}],"version-history":[{"count":0,"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/2202\/revisions"}],"wp:attachment":[{"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/media?parent=2202"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/categories?post=2202"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/slacc.co.uk\/index.php\/wp-json\/wp\/v2\/tags?post=2202"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}