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Archives for March 2022

You Bet Your Sweet Asset that Equipment Impacts Your Finances

The company car. The company computer.  The  office furniture. The stuff in the shop. Phones. Signs.

You know, the stuff that makes up the structure of your company?

Assets.

There are tangible and intangible assets.  Either way, they need, or should, be accounted for. Examples of assets you need to account for on your balance sheet:

  • Buildings and office equipment and other things not consumed during the course of doing business.
  • Depreciable assets like machinery and vehicles that are used as part of the business process.
  • Current assets including on-hand inventory and accounts receivable.

And while you can’t put them on the balance sheet, there are things that have value that could be converted to cash in this information economy:

  • Reputation, know-how and industry knowledge.
  • Brands and trademarks.
  • Formulas, patents, inventions and creative communication.

The point of all this is that your company is made up of stuff that has value.  You need to account for this value to ensure the stability and ongoing health of your company.

This list is just a starting place.  However, it should help you sort out value as you communicate with your finance team (CPA, accountant, bookkeeper) when managing your company’s finances.

We love numbers.  If you are looking for help with your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the board room.

*Photos courtesy of Unsplash (photographers Denny Muller and Scott Graham)

 

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How to Weather an Economic Downturn

The economy is cyclic.  So it is only a matter of time before you and your business experience a downturn.  But there is good news: things will come back.

Or so says history. And, at the moment, we are living it. A war in Europe. High gasoline prices. Supply chain issues.

As the saying goes ”if you fail to plan you are just planning to fail.” In other words, just make sure you are thinking about a downturn before it happens.

What should you do? Here’s a short list:

  • Create a 5-yer plan for your company.
  • Talk with your contractors and suppliers to help share the workload.
  • Let your employees in on the coming crisis.
  • Manage inventory and your supply chains.
  • Build an emergency fund.
  • Cut out waste or things that are not necessary.
  • Pay down debt.
  • Don’t be afraid to ask for help.
  • Consider helping others.

History shows us that downturns turn back up.  We survived 1987 and 2008 and other downturns before then.  Fact is, that we all need to think for the long term.  That’s where that 5-year plan fits so well with this concept of survival.

We love numbers.  If you are looking for help with your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the board room.

*Photos courtesy of Unsplash (photographers Luke Chesser and Towfigu barbhuiya)

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