Understanding A Business Health Check
(And Why You Need One)
As a bookkeeper, I’ve spent many hours checking the health of peoples’ businesses from a financial perspective. It’s something I’m proud of because I’ve refined the process over the years.
Initially, I chose to model the health check offered by Sudoku Bookkeeping on my personal experiences with the health system since it’s taken over my life on not one but three occasions.
More on that later, but I imagine you’re wondering, “How is a Business Health Check anything like a medical physical you might get at a visit to your GP?”
A Business Health Check does what it says on the bottle- it’s a system I use to check the health of your business’ finances to ensure your compliance and longevity.
The purpose of a health check is to work out the status of your data file and provide you with a plan. It also helps us to be able to give you an accurate quote for ongoing work. Our Business Health Check is a free consultation that takes around an hour and allows you to ask questions and gain clarification while checking the state of your business’ books.
If you’re feeling under the weather, usually your first port of call is your GP, but in this scenario, let’s imagine you’ve already been referred to a specialist.
If you’re seeing a specialist for the first time, you’re usually there to discuss your concerns. You may have seen another specialist before and want another opinion or have a quick check-up.
The same goes for a bookkeeper– as a specialist in the field of finance, I want to help you rest at ease, knowing your books are healthy. I’ll be able to tell quite quickly if your books look normal or if something seems out of place.
Yes, a bookkeeper is a specialist in accounts the same way a medical specialist is a specialist in human health.
During this initial check-up, I will:
- Check to make sure your accounting software is correctly set up
- Check if the Chart of Accounts is set up correctly
- Ensure that reconciliations of all bank and loan accounts are up to date
- Check if the payroll liability, GST, and ATO clearing accounts have been reconciled
- Check if the Business Activity Statements (BAS) and/or Instalment Activity Statements (IAS to report PAYG) are up to date
- Ensure that the accounts payables and receivables are reconciled
Suppose your specialist finds anything abnormal, medically. You’ll be sent for scans, bloodwork and any other necessary testing (personally, I despise MRIs, even if they are a necessary evil!).
The same with the accounts health check. If anything is ‘abnormal’, we will need to investigate further. For example, why does your cheque account closing balance does not match the bank statement balance? Why do the amounts lodged on the BAS not match what’s reflected in your software?
We’ll go through everything with a fine-tooth comb to make sure we get you on the right track.
If any issues are found, there’s no need to panic. It needs to be treated or fixed, but that’s why you have a specialist who will not only treat your illness or injury but guide you through the next steps.
Your condition may require medication, surgery, or other treatments. Some of these treatments may seem drastic, but your specialist is an expert in this field. You may feel overwhelmed and scared, but an ‘open and calm’ attitude helps to get better despite the emotional toll.
Finding something wrong with your business accounts can be stressful and frightening.
You thought you were compliant, so the idea that you may not be- especially if something is wrong with payroll or GST treatment of transactions, causing errors with BAS lodgements- is a daunting prospect. It may be something minimal that we can fix quickly, and although it may be more serious; either way, you’ll be guided through each phase of treatment.
I’ll hand over a comprehensive report, and we can make an appointment to discuss treatment options and the best way to move forward.
Everything is fixable in accounts by ‘putting your numbers in the right spot’, so we’ll set you up with a plan and time frame to fix whatever’s gone wrong with your books.
Following the diagnosis report, we’ll discuss what, how, when, and who will do the treatment. If you had an illness or injury, you’d be booked in for surgery, if necessary, and prepare for treatment.
The client can do some aspects of the treatment or fixes once you’ve been shown what to do and how to do it. It’s essential to cooperate as much as possible to get the fixes done as quickly as we can.
During and following the treatment, your specialist will set up few appointments to monitor your health by physical checks and tests, but generally, you’ll be able to go on with your life with a few minimal changes.
In bookkeeping terms, we’ll ask you to stay compliant by keeping a healthy file, so you don’t run into issues again.
Many clients request an ongoing agreement for Sudoku Bookkeeping to periodically do a health check on their accounting file, which we’re happy to do. Most common is a quarterly review before they lodge their BAS. However, a few prefer this done annually before the end of the financial year to ensure the file is ready for Single Touch Payroll (STP) finalisation.
For us to conduct your Business Health Check, we’ll need:
- An agreement signed by you to allow us to perform the health check
- Access to your accounting software
- A contact person to discuss any findings and get further documentation
- Possibly an authority to access your BAS’s and ATO account
Stay healthy, physically and numerically 😊
At the beginning of this blog, it was mentioned that this health check was modelled on my personal experience within the health system.
As a three times cancer survivor, I have been through this gruelling process for the past 10 years but I have been given a clean bill of health and has spent the last five years in remission from cancer.