12 STEPS TO SETTING UP AN EFFECTIVE MANAGEMENT INFORMATION SYSTEM FOR YOUR BUSINESS
- Set aside the necessary time required to do the regular reporting MONTHLY or QUARTERLY. Make it a priority!
- At the very latest get the regular reports completed by the 10th of the following month so the information they provide are timely and not out of date. Focus on current issues and future plans. Examine and fix any weaknesses or anomalies
- Understand your key business drivers and the resulting impact on the numbers. If necessary, get us, as your accountant and business advisor, to walk you through all the numbers and what they actually mean.
- Ensure you have the best systems and processes in place, including the latest cloud based financial tech software, systems, plug-ins and updates.
- Develop benchmarks to empower everyone in the organisation.
- Seek expert advice. A strong relationship with us, as your accountant and business advisor, can help ensure better financial reporting and earlier awareness of opportunities and threats.
- Utilise cloud storage. This will allow people to easily share and access documents – as well as work on them concurrently from different locations. This minimises the risk of data loss and inaccuracies occurring because of different versions of documents.
- Enable appropriate collaboration between all areas and/or departments who contribute financial data, and have security protocols in place to ensure data is always secure.
- Ensure you have a centralised end point for all data in the reporting chain.
- Ensure financial records and reporting is owned by someone with full accountability, who is responsible for checking the data and signing off on its accuracy.
- Utilise big data analytics, which can contribute to more insightful reports by analysing reports and highlight patterns and causes an employee may have missed.
- Develop benchmarks. This enables everyone in the business to understand what constitutes a strong performance, making it easier to identify underperformers and opportunities for improvement.
Above all, a management information system that delivers accurate financial reporting is key to understand your business’ true position and making informed decisions. On the flipside, the dangers of inaccurate financial reporting are extensive – so it pays to do the right thing.