If you're like most business owners, you think of being financially accountable as a necessary evil. It's something that you have to do, but it's not always fun or interesting. However, what if I told you that being financially accountable can actually be good for you? Believe it or not, there are a lot of benefits to being responsible with your money. So if you're looking for a reason to start tracking your finances, listen to find out more.

You've heard the saying "time is money." Well, that's especially true for entrepreneurs and small business owners. The more efficiently you use your time, the more money you make. Money management is essential to your success.  One way to improve your money management skills is to be more financially accountable.

Conclusion

So, being financially accountable is a good thing. How do you go about being financially accountable? By having a financial story plan and following it. What's your Northern star?

What's the end goal that you are working towards? Once you know that, everything else falls into place. You can start to map out how much money you need, where it needs to come from, what resources you'll be using along the way and all of the other bits and pieces that go into making up a successful financial journey.

If this sounds like something you want to learn more about, join my Numbers Know How Financial Story Plan Community, connect to my I Hate Numbers YouTube channel,  I'd love to have you there!

Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers, in a good way.  Check out what people have said, buy the book and make your own mind up, you won’t be disappointed.

If you found this podcast useful then share this episode on social, leave a review on Apple podcast.  Connect with me on Instagram, YouTube, Twitter, LinkedIn and Facebook.

Action springs not from fault, but from a readiness for responsibility. So said Dietrich Bonhoeffer. What was he talking about? What was he referring to? He's referring to what we're going to be discussing on this podcast on I Hate Numbers, that of accountability. More specifically, I'm going to be talking about financial accountability. If you're a business owner, ask yourself this question: Do you make yourself financially accountable for how you conduct, how you run your business, and how you perform? In this week's podcast, I'm going to outline the importance of financial accountability, how we go about it, and share some tips and tricks with you along the way.

You're listening to the I Hate Numbers podcast with Mahmood Reza. The I Hate Numbers Podcast mission is to help your business survive and thrive by you better understanding and connecting with your numbers. Number love and care is what it's about. Tune in every week. Now, here's your host, Mahmood Reza.

Hi, folks. My name is Mahmood. I'm an accountant, an educator, a mentor, and author of the book I Hate Numbers. My mission, my objectives for the last 27 plus years since I've been running my businesses have been to help businesses improve their financial awareness, win more battles than they lose for the what goes on between their ears, and help them and their businesses make more money, save tax and time. That mission, that objective, is as strong now as it was 27 years ago.

Before we crack on with the video, remember, subscribe to the podcast, keep in touch. Find out lots more what's going on in the financial and business world on the podcast I Hate Numbers, as well as the sister channel, YouTube - I Hate Numbers, as well. Let's crack on. The whole idea about accountability is if we're left to our own devices, that we have nobody checking in on us, nobody's to see how we're going, that's a very difficult challenge we're accepting. That's a very difficult roadmap where we have nobody to be accountable to.

You imagine that situation where people have personal trainers. They have personal trainers not because they've got money to burn, but because they need that external accountability buddy, somebody who's going to help guide them towards their own goal. In the world of business, our accountability buddy is our financial story plan. If you check out the show notes, I've got some links to explaining in more detail what our financial story plan is and an opportunity for you to be part of the financial community Numbers Know How.

Let's move on with the podcast. Now, your financial story plan is setting out your route map as to how you get to your Northern Star. It tells you the direction that you're looking to go in, the resources that you need, the ambitions and the aspirations and the effort that you'll be expending to get closer to your end goal. If you don't have a financial story plan, then that's solely going to be your first major task. Set out what your Northern Star is and how you're going to get to that end point. Having developed, having written, having come up with your story as to what the future is,

what's going to go for your business windscreen as opposed to your rear view mirror, then you mustn't let that gather dust. Whether it's a virtual document or otherwise. It's there as a living and breathing document expressing where your aspirations are, where your journey is going to be taking you, or certainly where you hope it's going to be taking you. As you progress forward on each week, each month, each milestone that you go through, you need to make sure that you're judging where you are going to end up against your expectations.

Now, the benefits of that are very powerful. For one thing, you can actually look and monitor to see how good your forecasting, your predictive skills are. The likelihood by then none of us would be able to guess perfectly predict with 100% accuracy where we're going to end up. Our financial story, though, is a representation, a reflection of what we think lies in front of us. Any deviation from that allows us to reflect, allows us to ask questions, allows us to examine why we haven't got quite where we wanted to.

If you imagine if I take that gym example, you’ve set yourself out a target exercise plan. If you haven't quite got to the level of fitness that you're aspiring to, if you haven't quite got to that tone that you're looking for in your body shape, if you haven't quite got to that level of heart rate, pulse rate, or whatever, then you can ask yourself the question, is it because of diet? Is it because I haven't actually expended all that effort? Am I training in the wrong way? Have I been injured? What's going on? And if I know what's going on, it's a reflective period and I can actually put that right.

It's no different to your financial story that's being used to monitor your performance. As you progress forward, you know the reality of what you're spending, you know the reality of the money that's coming in, you know the reality of how much profit you're making. And if you're thinking, how do I know this reality, Mahmood? Well, your accounting system, your digital accounting system is set up in such a way that it can capture the value of those transactions and it can convert those into something that's more meaningful.

If you haven't got a digital system in place, again, check out the show notes and I can give you a link to some free resources to help you look at that in more detail. Once I've got an aspiration, once I got my route map and I go through, then I'm going to be monitoring my progress. And that's very cathartic. It's cathartic and it's very anxiety reducing because it tells me how successful or otherwise I actually am. Be prepared for those slips, those deviations where you may not get to that first staging post, but that doesn't matter.

The fact you're progressing forward with the occasional bump in the road, with the occasional crash, diversion, perhaps even going backwards, doesn't matter. Don't look at it on a step by step. Look at the overall journey path that you're taking. In terms of the reality of using this story plan, you need to make sure that your financial systems, your accounting systems are geared up to capture what is actually going on. The level of sales and turnover that you're generating, the level of profitability. Ideally, you are forecasting and telling your story by product groups, how much you're generating by the different groups of services and products you are providing,

the profitability of those things here, the money in the bank, whatever financial measures and other objectives that you set yourself, you're monitoring your progress against those markers. Those markers you've identified as critical and important for your business, not somebody else's. Now, as we progress forward, if we're able to monitor what we're actually doing against where we should be, we're either going to get it 100% accurate and perfect, which is very unlikely, or we're going to have deviations from our expectations.

Now, when those deviations occur, we can examine them. We can see what the level and what the type of deviations actually are, financially or otherwise. We can see how far off course we are and then we can think, okay, why is it I'm not quite where I should be? You could, by the way, folks, be much further along the road map than you think you are, or you could be behind the curve. Understanding the magnitude of the gap that you have, whether it's measured in financial terms, whether that's measured in terms of the customers that you haven't gained, the network meetings you haven't attended, the marketing activity you haven't actually begun, the relationships that you're looking to start, whatever those key measures of success are,

as you look and measure your progress against those milestones, you're reflecting and thinking, why did I not do that? It could be objectives, your assumptions have changed. It could be circumstances have occurred outside of your control. Things may have cost you more money and you're not just interested it has just happened. It's the reasons behind that because you as your business leader, as the business owner, have the power to put those things right. Some things may be outside of your control. You need to factor in your revision to your future plan.

Now, having got that, understanding where we're deviating understanding there is a deviation, understanding why that deviation has occurred, we can then take action to put that right. And that's the key thing, folks. You've got to take action with the feedback and the feed forward system that you're actually looking at. Your financial story plan is that marker in the sand. It’s that accountability buddy. It keeps you focused, it keeps you on track, it keeps you moving towards what you've identified as your own Northern Star.

When we make those judgement calls as to how we're doing, how we're progressing, then unless you've got a measure, a reference point, something to measure against, that question is always going to be unanswerable. So folks, as far as your story plan is concerned, bear this in mind: once you've written it, once you've created it, it's the same process I've done with thousands of businesses. The moment you've written it, the moment you've created it, the moment you've laid it out, it will be incorrect the moment you've done that. Nobody can predict the future for the next year, let alone the next 10-15 minutes here. But it doesn't mean you shouldn't do it.

You're saying my ambitions, my lifestyle, my capacity, my skill sets, the people around me, this is what we are going to be doing. It's an affirmative action point. Measuring where we are against that path that we've chosen for ourselves is insightful, is productive, it reduces anxiety, and you need to have ownership of that. Just a roundup, folks. Make sure you have a financial story that's been created. Check out the show notes, I'll give you some links to some resources. And again, I'd love to invite you to join our financial community at Numbers Know How.

That community has got a cloud application to help you with the planning. We're building it up to be a membership that's going to encourage and help people with their business stories, their planning and other opportunities they want to create within their business. You need to make sure you've got a good system set up to capture that financial information, to capture the footprint of your story as it was expressed in financial terms. You need to make sure you monitor that against your plan.

Again, as a minimum, I would recommend at least once a month certain other figures in there that may be quite critical you might want to look at once a week. Be selective. Don't drown in those numbers, but look to where you set your tasks to be and measure your progress against that. Folks, I hope you found this podcast useful this week as they have been for previous weeks. Tell me what you think. Do you agree with those comments? Would you add anything? Are there topics that you'd like me to cover in future episodes? And more importantly, if you think that this is of value to you or your friends or your colleagues, I'd love it if you could share it with them. Until next week folks, happy reviewing.

We hope you enjoyed this episode and appreciate you taking the time to listen to the show. We hope you got some value. If you did, then we'd love it if you shared the episode. We look forward to you joining us next week for another I Hate Numbers episode.