Insist on Real-Time Access to Financials

Instant access lets you see where your money's going, and where you need to make adjustments.

By: Chia-Li Chien | Published 11/09/2010


Tina (not her real name) has been in business since 1998 and is in the top 10 percent of her industry. Tina has used the same CPA firm (let's call it ABC) since her business's inception. She typically sends her check registries, along with all bank and credit card statements, to ABC. ABC processes Tina's bookkeeping, accounting and payroll for 10 employees. ABC files quarterly sales tax, annual payroll and tax returns. Tina receives her company profit and loss statement about three months after she supplies the information to ABC. For example, if Tina sends in her July financial information, she will see the July and year-to-date (January to July) P&L in October.

In 2007, Tina was introduced to a national payroll firm. After diligently reviewing this new service, Tina realized how much the service she received from ABC had been lacking. Tina decided to move her payroll service to this national firm. The new service allows employees to complete their time sheets online. In addition, Tina has real-time access to all reports and a dedicated payroll representative to answer questions. Meanwhile, Tina continues to pay ABC the same monthly fee she always has even though the service the company provides has decreased. During her transition to the payroll service, ABC declined to provide backup data to Tina. The new payroll firm found many discrepancies in her 2007 accounts, and has been unable to obtain proper data. This is when Tina realized that she doesn't own her data: ABC does.

According to ABC, Tina has hard copies of all financial reports and returns, and ABC is not responsible for providing any additional information. As the owner, however, Tina is ultimately responsible for her financial data in case of an IRS audit.

This particular real-life example is not meant to imply that all CPA firms are like ABC or that every owner is like Tina. But this scenario may sound familiar to many of you who outsource your accounting or bookkeeping to a CPA or accounting firm.

You're doing the right thing by having an expert in accounting do your financials. But I believe that business owners should have real-time access to their financial numbers, not just the P&L statement. That way, you can make informed -- not reactive -- decisions. Here is the list of options I suggested to Tina in mid-2007 while she was transitioning her payroll service to a national provider:

  • In-source accounting: Consider having bookkeeping or accounting in-house if you have someone on the team with the ability to do so. Tina happens to be the most skilled person in her company, so she trains someone on staff to do data entry.
  • Full access to the accounting software: Have the accounting software in-house or hosted by an accounting software company. Tina decided to have the accounting software in-house and backup data online with the software company.
  • Use CPA to review, advise and file taxes: Today Tina uses ABC for monthly review of financial statements and to make proper adjustments if things are not allocated correctly. Most important, she receives advice from ABC so she can make decisions proactively.

In the fall of 2008, roughly a year after Tina insourced her accounting service, the U.S. financial crisis occurred. With real-time access to her financial data, Tina realized where she was wasting money and came up with ways to cut expenses to stay afloat during the crisis. As a result, in 2009, net profit went up 50 percent. Today, she uses key performance indicators to monitor her financial health on a monthly basis.

Here is what you might consider for your business to gain control and maintain healthy finances:

  • Have real-time online access to your financial information. Regardless of how you manage your accounting, as an owner, you must have real-time access to your financial information. It should include:


  • Standard financial statements, such as profit and loss, cash flow and balance sheet statements. You need to see current month, year-to-date and comparisons from the previous year.
  • Customer analysis:
    • YTD active customer count by year and percentage of revenue by top 20 customers by month or year
    • Sales by type of customer, a high-level breakdown to see what your customers are buying. For example, revenue by specialty groceries, instead of customer name.
    • Products/services: Breakout of products and services by dollars and by location. This could be the customers' geographic location or your company's geographic location.
    • Year-to-date: Aged accounts (accounts more than 90 days old) receivables and payables report, plus inventory and equipment reports. Aged account can create cash flow problems. You're not in business to finance your customers' purchases.
  • Regularly monitor and compare your current-year projection vs. actual finances. You and your team need to know where you stand financially so you can adjust your activities accordingly. Your annual projection is not "nice to have"; it is a "must have." With this information, you can determine on a monthly basis whether you're ahead or behind on your annual projection and create an action plan to address the situation.


  • Regularly monitor a set of key performance indicators (KPI) that matters to your business. For example, Tina needs 400 monthly subscription members to remain in the top 10 percent in her industry. That is one example of the KPI she uses in her weekly staff meeting.


  • Maintain a three-month cash reserve. Many of you take all the earnings out of your company for tax reasons. However, having a good cash reserve in the company can reduce a lot of unnecessary stress and save on expenses, such as interest on an equity line of credit.


  • Revisit your service agreement with your current CPA or accounting firm. Do this to obtain real-time access and data ownership.

Having real-time access to your financials helps you make informed decisions. This allows you to do what you do best for the business -- and for your customers.


Chia-Li Chien, CFP®, CRPC, PMP; helps women entrepreneurs to convert their business into meaningful personal wealth.  She is the author of Show Me The Money and columnist for & Fox Business online.   She is available for consulting, speaking engagements and workshops.  She can be reached at or


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