Financial clarity changes how you lead your business and how supported you feel inside it.

This conversation explores the difference between revenue and cash flow, the role of a CFO versus a bookkeeper, and why understanding your numbers is essential for sustainable growth. It breaks down financial concepts in a way that feels accessible, grounded, and aligned with soul-led entrepreneurship.

When you stop avoiding your numbers and start listening to them, your business becomes a place of clarity, confidence, and conscious decision-making.

Connect with Stephanie Smith, New Light Financial Solutions:

https://newlightfs.com/drivers/

https://kpcreativemedia.com/growth-clarity-call

Mentioned in this episode:

Be In Demand Public Speaking: https://pod.link/1524969833

Hello there, beautiful women.

It is Kim Parkinson for podcasting for your spiritual business.

And today I have on a very special guest that is going to talk about more finances.

So we have on today Stephanie Smith from New Light Financial Solutions.

And Stephanie is a CFO and business owner who helps entrepreneurs generate more cash and profit by using clear, data driven financial strategies.

With a background in mathematics and corporate training, she's known for uncovering why businesses struggle financially and breaking down exactly how to fix it in a simple, practical way.

And let me just tell you that I know that we all need this because we all struggle with just the mundane tasks of our businesses.

And unless you are really into finding out your numbers every single day, taking a look at those numbers every single day, which maybe we should be, but if you are not doing that, you need to know why this is really important.

And so Stephanie is here today to kind of go over a little bit about that.

And she also has a podcast too.

So, Stephanie, tell me about your podcast.

Thanks so much, Kim.

I'm excited to be here.

Happy to talk about this topic since it's so close to heart.

My podcast is called Getting to the Bottom Line.

So I actually talk about things that impact your revenue, profit and cash flow.

And I love to have guests on that have businesses that do things that will impact your revenue, profit of cash flow.

So, Kim, you were a guest on my podcast talking about how podcasting can boost your revenue.

And there's so many facets to the financial space and business.

I think a lot of people just think sales, right?

And then expenses.

But it's so much more than that.

There's so much impact to it.

So I love to, to talk about it and, and hear other people's perspectives as well.

I love that.

So you mentioned that you're a cfo, but what is the difference between a CFO and a bookkeeper?

Oh, yes, this is a good question because we also do bookkeeping, so we do both.

But a bookkeeper is someone that helps you track the past, essentially.

So the things you're spending your money on, where your income comes in, your bookkeeper will help you take all of those things, put them in the right categories, and prepare your financial statements for you.

So they're the ones that are making sure to keep track of this.

So when you go and you need to file taxes later and they ask you how much did you spend on meals and entertainment this year, and you would be able to have that number because your bookkeeper has categorized those things for you, they also make sure that your bank accounts match your books.

That's really important because a lot of the times there's extra things that go on in our books.

Sometimes if you have accounting software and you know, technology is technology, so they help with that.

They make sure everything's accurate and categorized correctly.

Whereas a CFO is really more forward thinking.

So in the CFO space, we do three things.

We will review your finances.

We'll see what's working and not what's not working, and then we'll propose corrective action.

So we do use the past to help make decisions about the future and help see what we predict is going to go on.

But what we do is really look at the strengths and weaknesses of the business from a financial viewpoint and then direct our clients in what they can do to do things better or improve their financial situation.

And a CFO for those people in the back that may not know what that stands for.

Chief Financial Officer.

Yes.

Chief Financial Officer.

Yes.

Should have mentioned.

Yeah, that's okay.

No, no, yeah, absolutely.

So, you know, sometimes people don't know the acronyms or they don't realize that they need one.

And what, at what point in a business do you think that you might need a cfo?

When do you suggest coming in?

That is a good question, because I think too, we think Chief Financial Officer.

And a lot of times you think like Coca Cola.

Like these really big organizations have these, these roles and they have whole departments and everything.

And that's just too big.

And smaller businesses don't need anything like that.

But what we do is help the, help the smaller businesses because we all need that financial clarity.

So whenever you get to the point where you're enough money to where you need more guidance to see how you're doing, and you want to make strategic business decisions based on what's going on in your business, and you want that clarity into what your finances are telling, what's the story that's going on?

I would say that's a really good point.

To hire a cfo, we all need financial clarity no matter where you're at in your business.

So it's usually in a point in your business where you've, you've passed that, like, starter stage and you're like, what do I do next?

I want to open a new location or somehow I've gotten myself in financial trouble.

Right.

And I need someone to help me fix what's going on.

So it's usually a little past the starter stage.

But we all need that same financial help in our business.

Yeah.

When you take on a new client to be a cfo, do you.

You talked about going back in time and taking a look at some of their, their past stuff and then doing projections on their, on their forward thinking.

Do they need to have a clear idea of what their offers are?

Is this something that they can't add new things to?

Or you do suggest to add new things to.

How, how much of this needs to be almost like, set in stone before they can be good at projecting finances in the future?

I don't think you have to have any of that set in stone.

Right.

Regardless of what's going on in your business, we can make predictions of if nothing else, like, if nothing changes and you do exactly what you're doing today, this is what it'll look like in the future.

Right.

But as we work with our clients, we do first look at the past and we start making those projections, we have conversations with our clients, like, what are your plans?

Are you planning on adding new products and services?

Are you planning on adding new locations?

Are you planning all of those questions and those details go into that projection and that might actually lead into a conversation about, like, are you pricing your products?

Well, let's talk about what your margins and how much you're making on each of your products.

Does it make sense to keep offering certain products if you're actually making the majority of your money on one one service, but you're focusing all your time and energy on the one that isn't?

We can have conversations around that, too.

Just really digging into the numbers to get more information.

Yeah.

So that's like, brings me back to that.

You really kind of have to have an idea of what's going on in your business and in your books, too.

How I know you're going to tell me it's going to be super important, but for those of us that maybe, you know, we have more of a spiritual draw where we're kind of like, maybe we want to have our feet grounded, but we're not quite there yet when it comes to the finances.

How would we, how would we get started?

Would it be looking at our books regularly?

What would you be the first step for this?

For us, I would start making.

By making sure that you're tracking your finances.

Right.

So a lot of people are still in Excel.

We get people that reach out to us.

We're like, I think I'm ready to move to like, a quickbook.

So definitely tracking is number one.

Right.

And I think even in the podcast space.

Right.

You're looking at numbers at some.

So how do you know how you're doing if you don't have it written down of what's going on.

So step one is always make sure you're tracking.

I would recommend finding some kind of accounting software to help you with that.

It just makes life easier.

And there's a lot of AI that can help automate things and stuff, but then the next one is actually looking at your numbers.

And we were talking a little bit about this before the show of how often do you spend looking at your numbers?

And a lot of people don't.

And that's really just the way it is.

And especially if your business is making enough money to where you feel like, I have money in the bank, I can just spend.

Spend whatever I want.

Those situations, I think make it a little harder because you're not needing to be a little more mindful about your spending.

But I would recommend at least once a month, if not once a week, put a date on your calendar and spend some time and just look at what's going on.

Compare it to what happened in the previous month or the previous week or the previous quarter, and just see what direction you're going in.

And does it make sense?

Am I on track to where I want to be?

Right?

And am I looking to make a lot of money this year?

But I have nothing.

Then all those questions when you start asking what's going on can help shape the direction of where you go next.

So do you have any common cash flow challenges that seem to show up for people?

Is this just looking at your books every day, or is there.

Is there, like, hidden fees that might be there?

What kind of challenges are you seeing for small business owners?

I think the biggest challenges that I see is that people are making money on paper.

Like, you make a sale, but then you look in your bank and it's empty or it's not there.

Right?

So it feels like you're making a lot of money, but it doesn't seem like you don't see the money.

You don't see the result of that.

And a lot of the times that happens because of a few different reasons, which is all around your cash flow.

So it's about understanding your cash flow.

Money in and money out.

And I'm not gonna go into all the jargon, but if you get paid on an invoice, but you have expenses that you need to pay for rent, and you have to pay for your contractors, and you have to pay for these other things, maybe that invoice you.

You don't get paid until after the job is done well, all those other things need to get paid regardless of whether the job gets done.

So then where's the money coming from?

Is it coming from a different invoice?

Are you having to find the money on a credit card or, you know, a loan or something like that?

Because you need the money to pay those expenses, but you haven't actually received it from what you're doing.

So I would think that's the number one thing, is figuring out the right timing of the money in and out of your business and if it matches up and it makes sense for your business.

I know that I personally do struggle with this myself, and I have.

And this is not my first business either.

I've had a couple of businesses where I've never had a cfo.

I've had bookkeepers.

But realistically, I don't know how to do projections.

I don't know how to think forward to the future for those businesses.

If you were to give any kind of advice, what would you look at for that?

Is there a.

Is there an area where you would definitely say you need to look at these numbers for projections for the future, or is that an overall piece?

Where do you start?

I would say if you're.

If you're starting and you're wanting to get into projecting, start.

I would say start by making yourself a budget.

I feel like that's.

Where do you think you're going to spend this year and start with that?

But we look at specifically 16 drivers of revenue, profit, and cash flow, and they're all kind of in different buckets.

But it's anything from your leads, the number of leads, it's your average sales transaction value.

So how much are you charging per customer?

Do you need to increase your prices?

Those kind of things, those revenue drivers, leads to how much revenue?

So you, if nothing else, you should be tracking your revenue.

That's definitely one of the main ones.

And then we talk about cost of sales or cost of goods sold, or cogs, depending on what you're.

What area you're in, it's a little different.

But this is how much it costs to actually produce your product or service.

And I like to give a really simple example that's like if you, if you're selling T shirts, you have to buy the T shirt and you pay for the paint, and you might pay for someone to make the T shirt.

All that is in your cost of goods.

That's the labor involved.

And whatever you sell your T shirt for, you have to subtract out that amount.

And what's left is your profit for that particular T shirt.

So you want to look at your gross profit and your margins.

Right.

So if you sell your t shirt for $20, but it costs you 21, you're in the hole.

Yeah.

So definitely want to see costs there because that's one way to generate more revenue for yourself is to make sure that your margins make sense for your products.

And then the other things that we look at are really expenses.

So a lot of things like your payroll is one of the number one expenses for people.

Marketing is another big one, and all your other overhead expenses.

So I think these, I would pick the top ones that you're spending money on and track those ones.

So if you, if marketing is one of your biggest things you spend money on, watch that.

Then we also look at some cash flow drivers.

So like accounts receivable.

How fast are people paying you?

If you send someone an invoice and you give them 30 days, but they take you 60 days, it takes 60 days for them to pay you.

You're giving them a loan essentially of 60 days, or maybe they'll never pay you and you never see that money.

So we look at how fast people pay.

We also look at how fast you sell through inventory, if you have inventory, and how much you're paying yourself, the draws out of your business.

All those impact cash, everything's related to your cash.

So I do have a handout that has all 16 of these.

I'm happy to share that with your listeners if they want to go and look at them.

But I would start with just the biggest revenue.

Your cost of goods, what it costs you to make your products, and your largest expenses.

And then if you do have things like loan payments or you're paying yourself, you can track some of those things as well.

That's great.

And yes, I will definitely take that freebie from you guys.

But here I wanted to just kind of like maybe go over.

You talked about T shirts, but a lot of times in this digital age we have people that are coaches or service providers.

So I just wanted to kind of go over some things that I think that maybe they should be looking at and you can confer or say, no, that's not it.

But maybe things like your learning platform like teachable or thinkific or if you are using some type of a platform for them to get into your programs, maybe it's your CRM like Moxie or Dubsado or go high level.

Even if you're using something like that, those are pieces that you need to put in those would be like your T shirts, because that's the core part of your business.

Am I.

Am I understanding that all correctly?

Because I feel like that is.

But maybe there's a different aspect to that.

Yeah, so that.

That's a great question.

I would say that a lot of the things you mentioned fall on the software.

The software bucket.

Right.

For your listeners, definitely looking at what you're spending on software makes a big difference.

And review your subscriptions and cancel the things you don't need.

That's one key there.

But when it comes to what falls into that category of cost of sales is you cannot provide your product or service without those things.

And typically, software doesn't necessarily fall into that bucket.

It would be more like if you are a coach and you provide materials and your materials are required for your service, then that would be a cost of sale.

Right.

So if I'm going to go and teach somebody something I know I'm going to bring these materials with me and I need this for my course, then that would be included.

It's not as much.

There's a lot less cost of goods, I feel like, in the service, in the service space than there are if you have inventory items.

Yeah.

Because I feel a lot of times people will look at that.

And I know that my bookkeeper does put it out by software and she does other different categories and tags that honestly, I'm sure you know about, but I can't think of them off top my head right now.

But she will ask me every month I get a spreadsheet, and every month she says, what is this specific, you know, itemized deduction for, or what is the specific itemized incoming for?

And so she, she makes it and tracks it by either I'm doing like VA work, podcasting work, or coaching work.

And then it's.

Sometimes it's, you know, maybe I purchased a course or maybe I did pay for some ads.

I've done some Overcast FM ads recently to do some podcast growth.

And so those would be under the advertising section.

But whereas I don't have.

I did own a brick and mortar.

So I did have a whole lot of, you know, products in house for sure at one point, but now there's no products in house.

It's just basically all digital assets, just digital pieces.

It's definitely a different world.

It is.

It's very.

It's very different.

The hard part is when it comes to bookkeeping is it's not the same for every business.

So it, like, you like having this conversation with you if you were my client and I'm your bookkeeper, I would ask, how do you want to see it?

How do you want it broken down?

Everyone's different.

Every one of our clients, they have it set up differently.

And even the conversation of what's in your cost of goods and what's not, it's.

Everyone kind of does something a little, a little different.

And there are, there are some standards around it, but it's not enough to be like, everyone has to put their subscriptions in this one category.

And that's just the way it is that.

So I would think if you're in this world and you're, you're wanting to see, get more clarity is ask yourself, what do I want to see broken down?

And is it too broken down?

Like, this is too much detail.

Like, I have one, I had one client that instead of having software, we had a Zoom account, we had a go high level account.

We had an account for every single one.

Because he wanted to see that.

He wanted to see how much he was spending on every single one of his separate softwares.

But that might be too detailed for some people.

Right.

Then that might be overkill.

Probably is.

So you have to ask yourself, what is it that I want to look at when I run the report?

What's going to give me the most clarity and help me better understand what's going on?

And then you should set it up that way.

I love that.

I didn't even know that you could do that.

Thank you.

And I think so.

She does break it down by clients that are coming in via, like, like I mentioned, like I have a couple of old VA clients and then I have a lot of podcasting production clients and then I have podcasting coaching clients.

So she breaks that down.

But I think you could even be more granular.

Like I could do like how many launches I do or, you know, how many 14 day growth sprints I do, things like that.

But it all depends on what I want to look at.

Right?

It's.

It's what I want to see.

And, and then, you know, that would be, that would help you with projections.

Looking at those numbers and looking at how many people were in each one of those buckets and saying, oh, I don't know, maybe launches isn't the way to go because I only did three of them or whatever it might be.

So that's where the CFO would come in.

Right?

That's.

Yeah, they definitely would help give you the clarity on that.

And I would add that there is a difference between your Profit and loss that will show you this, like, overarching breakdown of what's going on.

And there's lots of other reports you can get.

So if, if you're invoicing out of, let's say, QuickBooks, you can pull a report of your sales by service, sales by product, so you can see, or sales by customer, even how much you're making by customer or by product and get a different kind of breakdown.

So you don't necessarily have to go super granular on the main report.

You can go check out all the other reports that they have.

And there's probably one you're looking for that you don't know it exists out there.

Yeah, sometimes I think you just have to go into QuickBooks and play around.

I use QuickBooks, but I know there's others that are out there.

But just maybe go and play around and you're not going to break it.

I don't think.

You can undo most things.

That's good.

That's good to know.

Perfect.

So if somebody, and maybe we're all going to cringe.

If somebody has a business and maybe they've been in business a while or maybe they haven't and they haven't done any kind of tracking, what would you suggest doing or starting with first?

An Excel spreadsheet.

If you can afford it?

I would say get like a QuickBooks or a lot of our clients are actually on Zoho Books.

There's some free softwares out.

It depends on how big of a, how, how big of a business you have.

Wave accounting is one of them.

But I think if you, if you don't want to pay, there's a limit to like how many clients you can have and those kind of things.

But it's the beginning of the year when we're recording this, so it's a great time to start at the beginning of the year to just get it connected or get it started.

If you are not great with spreadsheets, don't, don't start with a spreadsheet.

The good thing about like a QuickBooks or really any of the softwares that exist is you connect your bank account and all your, all your transactions come in.

You can set up rules and stuff to auto categorize things.

If you know, if you knew Zoom's gonna go into your subscriptions and every time that you can set up a rule to where it does that, but it's a really great time to do it.

You just start and start in January.

You don't.

I feel like a lot of people Think I've just never done it too.

It's gonna be overwhelming because I have so many years.

I would say, well, forget about the previous years, unless you really need all that information and just start now, because now is better than never.

I agree.

I 100% agree.

I just went over my QuickBooks and went into all of my P. L's for the last couple of years and wrote down all my numbers so I would keep them fresh in my mind because, you know, what they.

What do they say?

Where the.

Where your attention goes or where your attention goes, the money flows or something like that.

I can't remember what it is.

No, I don't know.

But I know that when you keep that number in your mind, then you can definitely think about, is this the direction that I want to go in and do.

How much more do I want?

And things like that.

So, yeah.

Oh, yeah.

When we talk about goal setting, we'll say, let's talk.

We set targets for the 16 drivers that we.

That we look at.

And that's part of it.

Let's see what we did last year.

What do you want to do this year?

Ask.

Can.

Can you actually do it right?

You want to set yourself actual obtainable goals.

You can always adjust in the future.

And then are you happy with it?

If you're not happy with the number, then you need to change the goal or change other things.

Right.

So.

But it's.

It is definitely something to look at when you're setting goals for your business is does it make you happy?

And if not, then why?

And dig into that a little bit.

Yeah, yeah.

That's really important.

I feel like I'm at the point where I would love to, like, 10x my business, you know, so having to look at those future goals is really important part of that.

And looking and diving into those numbers, as scary as they may seem, I'm not.

I'm definitely the poster child of looking the other day the other way when it comes to my numbers.

But I'm trying to be good, trying to be better about it, Trying to look at them different.

Maybe not daily, but every other day, for sure.

Well, you have to start somewhere.

And I think first is just overcoming the fact that you haven't been.

And there's a lot of sh.

I feel people feel a lot of shame and guilt for not being really involved in their numbers or not knowing.

There's a lot of people that don't understand their financial reports.

They're very confusing.

Before I started getting into this, it was the same thing, like how do you know what any of this means?

And so I would just tell all the listeners that if that's.

You don't feel bad about it because you're not alone.

There's a lot of people that don't look at their numbers because they just don't understand them.

And the best thing to do is to just like you would do anything else in your business, if you're wanting to learn something new, you either go find resources, go on YouTube, there's a ton of them, or hire someone and partner with someone that can help you with that.

And if.

If you have a good bookkeeper and they.

That's part of their service, they might.

They might be willing to have meetings with you and call you and talk through things.

It really depends on what you're looking for from the partner that you have with either bookkeeping or your cfo or even if you're.

Who file whoever files your taxes for you.

They.

We could all do these things.

It's just whether or not you have that set up in your partnership.

Yeah.

And just small bites at a time.

Maybe one little thing if you do.

Like I was telling you earlier, I'm moving over to go high level.

And so I'm just doing one little thing every day.

And hopefully by the end of the year it'll be all put together.

But I feel like it might be the same with your finances if you've never done them or if you're afraid of them, or maybe you're not really at a point where you want to hire a bookkeeper or a CFO yet.

Just one thing.

One thing every day just to kind of move that needle forward will help your business.

And, and then you'll learn a little bit more every day.

And then.

And then you'll get to a point where you need somebody that will help you.

Right?

Yeah.

One.

One step at a time.

And when we went with our CFO services, what we do is every month we set goals.

Like, how are we going to get from step, you know, step A to step B and talking about what's the right next step?

What's the very next step?

So instead of thinking that this is super overwhelming and I have to do all these things.

Things.

It's.

What's.

What's the one next step?

Is it finding a QuickBooks or Zoho?

And it might be that.

Let me just go look at the software and then it's okay, well, now what do I need to do?

Do I need to learn the software?

So I think breaking it down into the.

The one next thing you need to do is very helpful as well.

Great.

Excellent.

So could you tell people how they can get a hold of you if they would like to talk to you some more about your services and what you have to offer?

I'd love to throw you out there for them if you.

If you're available.

Absolutely.

So the easiest way to find me is on our website.

It's newlightfs.com so we're Newlight Financial Solutions.

You can find me on LinkedIn, but I'm a Smith and I am.

I'm hard to find.

So the website is usually the best.

And I actually do have a YouTube channel if you are interested in getting into Zoho books.

I have a bunch of tutorials on how to use Zoho books and do that so you can find me on YouTube as well.

I love that.

Perfect.

And throw out your podcast name again so people can listen.

It is called Getting to the Bottom Line.

Love that.

Love that.

Any other advice or anything that you might want to just let the listeners know before we wrap up today.

Any words of wisdom?

I feel like just celebrate your wins.

I'm in it.

You just.

I.

Whatever's going on, whatever steps you take, just be proud of yourself and don't be down on yourself because you haven't done it all.

Just be happy with yourself that you've taken the one next step.

I love that.

What a great way to end it because.

That's right.

Because a lot of us are so afraid of our finances or we just don't take care of it enough.

But yeah, celebrating those wins is a great way to end that and have it then.

Thank you so much, Stephanie for being on today.

I really appreciate it.

Thanks for having me.

Thank you so much for listening to this episode of Podcasting for Spiritual Women.

If you would like more strategy and tips and sim tricks on how to make your podcast better, I recommend that you join my newsletter list.

You can find that at the end kpcreativemedia.

Com newsletter until next time.