Financial Management

Tips and Tricks for the Family Business Owner Who Doesn't Have or Need a CFO... Yet!

financial management "Financial management, for many family businesses, is more of a accounting or bookkeeping function than a management function," according to top family business expert Don Schwerzler. "For a family business to grow and prosper, the accounting and bookkeeping functions need to evolve into a management function. If that infrastructure change does not occur, the family business will not maximize the full potential of the business."

Schwerzler has been studying and advising family business entrepreneurs for more than 50 years and he is the founder of the Family Business Institute. Financial management is the job of the Chief Financial Officer (CFO) of the business.

Wikipedia defines CFO:

The chief financial officer (CFO) is a corporate officer primarily responsible for managing the financial risks of the corporation. This officer is also responsible for financial planning and record-keeping, as well as financial reporting to higher management. In some sectors the CFO is also responsible for analysis of data. The title is equivalent to finance director, a common title in the United Kingdom. The CFO typically reports to the chief executive officer and to the board of directors, and may additionally sit on the board.

For those family businesses who can not afford to have a CFO, we offer some tricks and tips from our financial management experts: Financial management - for the family business owner who doesn't have a CFO and all the trappings of big companies!

Let's face it - big companies need and can afford to have a whole arsenal of specialists and professionals to help them. They already know the tips and tricks.

But, many of our smaller (and some that are not so small!) family business clients don't have professional financial managers. But you still need to run a a tight ship financially. So, this section is for you.

Retirment Planning - Cashing In

Family Business Finance Expert

If there's something you'd like covered - or if you want to talk about how one of our ideas might apply to your family business - or family! - use this link

,Fractional Executives Fractional executives can meet the needs of a growing family business in a cost effective and flexible way. Now a family business that could benefit from a C-level executive but where the company is not large enough to support the cost of a full timer, a fractional executive would be the answer!

Bank Reconciliations
Bank reconciliations - no fun, but family business staff and owners need to understand the procedure. Here's a good refresher.

Bank Sweep Accounts
Bank sweep accounts are a great tool for centralizing cash management amongst several accounts. But there are pitfalls - learn what to record and what not to record.

401 (k) Plan Management Retirement plan management is a complex and time consuming business process that many family business owners prefer to delegate to others. But is that always a good idea?

Journal Entries - Very Revealing!
Journal entries in accounting are somewhat analogous to the initial readings and observation that is made every time you visit your doctor. They are very revealing!

Credit card balance transfers - they're not as cheap as you think!
Credit card balance transfers are increasing. Watch out for the service fee you'll be charged to access this low interest rate.

Construction Draws
Construction draws have become an area for sharp-operating General contractors to earn extra profit - at the expense of their Subcontractors.

Mortgage Escrow
Mortgage escrow is a viable concept that has been abused by lender's greed.

Service Charges
Service charges are often a drop in the bucket to the payer, but make big bucks for the merchant. Learn how one made $18 million a year - in a scam.

Accounting Information System
The first step to take charge of the financial well being of your family business is to have a solid accounting system.


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