Financial
management and
business success
– a guide for
entrepreneurs
Financial management
is at the heart of
running a successful
business. It affects every
aspect, from managing
cash flow and tracking
business performance
to developing plans that
ensure that business
owners can make the
most of opportunities.
This guide highlights
how fnancial
management can
help your business,
and how to make sure
you have the fnancial
capabilities you need.
May 2016
About ACCA
ACCA (the Association of Chartered Certifed
Accountants) is the global body for professional
accountants. It offers business-relevant, frst-choice
qualifcations to people of application, ability and
ambition around the world who seek a rewarding
career in accountancy, fnance and management.
ACCA supports its 178,000 members and 455,000
students in 181 countries, helping them to develop
successful careers in accounting and business, with the
skills required by employers. ACCA works through a
network of 95 offces and centres and more than
7,110 Approved Employers worldwide, who provide
high standards of employee learning and
development. Through its public interest remit, ACCA
promotes appropriate regulation of accounting and
conducts relevant research to ensure accountancy
continues to grow in reputation and infuence.
Founded in 1904, ACCA has consistently held unique
core values: opportunity, diversity, innovation, integrity
and accountability. It believes that accountants bring
value to economies in all stages of development and
seek to develop capacity in the profession and
encourage the adoption of global standards. ACCA’s
core values are aligned to the needs of employers in
all sectors and it ensures that through its range of
qualifcations, it prepares accountants for business.
ACCA seeks to open up the profession to people of
all backgrounds and remove artifcial barriers,
innovating its qualifcations and delivery to meet the
diverse needs of trainee professionals and their
employers. More information is available at:
accaglobal
Running a business can be intensely
satisfying but also hugely challenging.
Business owners face a multitude of
demands on their time, balancing the need
to prioritise and deal with a range of
urgent tasks while also fnding time to look
at the bigger picture.
As an entrepreneur, you may well be driven
by a passion for what you offer, and focused
on what customers want and how you can
gain an edge on your competitors. You will
also recognise how important it is to be
able to raise the fnancing you need. In fact,
fnancial management can contribute much
more to achieving your business goals.
Business planning helps you identify,
assess and capitalise on new opportunities.
It lets you think through your options and
create an action plan that minimises costly
mistakes. It is also a crucial tool if you need
to convince fnanciers and others to
support your business.
Skilled fnancial management is critical for
putting your plan into practice. Effective
administration, compliance and cash fow
management are just the starting point.
Financial skills let you track and measure
performances, identify problem areas and
new opportunities, and minimise risks.
The right fnancial capabilities remain
vital throughout the life of your business,
whether you are just starting out, have
an established business or are looking
towards a fnal exit from the business.
Your fnancial management needs will
continually evolve as the business grows
and circumstances change.
Successful, growing businesses take a
proactive approach to fnancial
management and to making sure that they
have the right capabilities. Financial
management plays a continuous role in
both day-to-day management of the
business and broader strategic planning.
Senior management must recognise how
the needs of the business change as the
business grows, and make sure that the
organisation has the fnancial skills that will
help the business look to the future.
As a business owner or manager, you need
to recognise the importance of fnancial
management. You may be able to delegate
some of the tasks involved – to employees
or outside experts, but you yourself need
to be always looking ahead, ensuring that
your business continues to develop the
fnancial capabilities it will need to achieve
its full potential.
1. IntroductionThe right fnancial capabilities
remain vital throughout the
life of your business, whether
you are just starting out,
have an established business
or are looking towards a
fnal exit from the business.
Your fnancial management
needs will continually evolve
as the business grows and
circumstances change.
Jacyn Heavens was inspired to start
Epos Now by his own experience of
how diffcult it can be to run a business
without the right fnancial information
and controls. Epos Now helps retail and
hospitality businesses overcome this by
providing point-of-sale systems that let
them keep track of transactions and
understand their performance.
Before starting Epos Now, Jacyn had
been running a cafébar. He quickly
realised that there was a problem.
‘I knew how much I was paying
suppliers, and I’m a natural
haggler, so I was sure I was
getting a good deal. But I’d only
know what our total outgoings
were by looking at the bank
statement. The bar could be
buzzing, full of people, yet I’d
have less at the end of the night
than I would on what felt like a
quiet day.’
Jacyn was desperate to know what was
going on: what his income really was,
what products were selling well, what
margin he was making and most
importantly whether the business was
actually proftable.
Those diffculties have now proved to be
a blessing in disguise. Over the fve years
since Jacyn set up Epos Now, the
company’s annual turnover has grown to
reach 10m, with over 150 employees
and 10,000 customers. Right from the
start, fnancial management has been
critical to the company’s success.
‘Initially, we focused on
growth in revenue and our
profit margin. As a self-funded
business absolutely everything
we did needed to make money.
We were living month-to-
month, and cash flow was
crucial. That focus meant we
could cope when the launch of
our first software was delayed
by four months. Otherwise,
we’d have folded.’
As the business has grown, the emphasis
has shifted to building predictable,
recurring revenue. Quarterly results and
future trends are more important than the
immediate here and now, and fnancial
management has become more detailed.
‘We’ve been profitable overall
since the early days, but now
we look separately at each
marketing campaign, each
source of new sales leads, each
sales channel. Looking back, even
in our most profitable months
we’ve made big losses on some
individual channels but we never
spotted it at the time.’
At the same time, the company has
invested heavily in automation. Improved
systems give Jacyn and his team
real-time access to accurate key
performance indicators.
Despite all the success, Jacyn admits
that his initial planning was not as good
as it should have been.
‘I saw the opportunity in the
market, and thought “let’s
give it a go”, but I’d never
recommend this now – I got
lucky. I remember the day, later
on, when I met a new employee.
I realised we had to have a more
structured approach. With people
dependent on the business for
their livelihoods, you can’t just
rely on gut instinct.’<