A modern approach to accounting, finance and the broader business
Updated: Oct 24, 2022
I'm particularly proud of the technology stack we have implemented in our finance function since returning to the business in 2018. Prior to this, we had a bloated local network based accounting system and a lot of staff keeping themselves very busy but not delivering a lot of effective commercial output.
This was no fault of the team - we had just stuck with the systems we had rather than looking outwards at better options that might be available. The status quo worked, so why change it? This was the thought at the time I suspect within our finance department.
However, in 2018 we made some significant changes to our business and it was the perfect time to bring in a more modern approach to accounting, finance and the broader business.
With the technology we now have in place we are able to employ a few people to do the same job that previously required up to 10 people - we've gradually built on Xero as the beating heart of our finance function and built upon this heart with a selection of other financial organs to deliver what the business needs.
Whilst there are now many cloud-based accounting tools, we decided to implement Xero due to the large amount of software integrations available and the simple user interface which reduced the need for detailed proprietary training.
We worked closely with our new accounting firm FLB to help migrate our business to Xero and now use a combination of internal and external resources to support our finance function.
Without doubt, the implementation of Fathom within our business has been transformational for myself and our C-suite as we now have an incredibly powerful set of tools to provide management reporting, forecasting and analysis in real time - all integrated with the core data that is in Xero.
In practical terms, this means that once our finance team complete their month end tasks, we can immediately see with a few clicks what impact this has on our business. Crucially, Fathom enables non-financial people to be able to create the reports in the format they want, using accurate data that is constantly updated into Fathom from Xero.
Moreover, we can create scenarios ourselves without needing the help of dedicated finance or BI professional to support us. We worked closely with Ben Cooper at Amplify Business who was instrumental in helping us get up and running quickly with Fathom and continues to support us to this day. Without doubt, Ben’s impact on our business has been tremendous and we’re delighted with how we can now use Fathom to really understand our business.
I am a big believe that “Revenue is Vanity, Profit is Sanity but CASH is reality” - over the last 20 years in business, I have experienced massive revenues, but no profit or high profits but very little relative cash. Whilst high revenues or EBITDA may sound impressive, the simple fact is that cash is the oxygen of a business - when it’s there we don’t notice it, but when it goes away it becomes very important very quickly.
We have now implemented Agicap to help us manage our cashflow and ensure we can always have a clear understanding of our future cash and bank balances. Agicap sits on top of Fathom and Xero - Xero gives us the latest accounts and then Fathom applies a forecast on top of that with projected revenues and cost. We then use Agicap to understand what cash will be coming in to the business and what costs need to be paid for and where our bank balances will be.
Looker, Snowflake and Fivetran
We used to have a BI team working within finance to help answer questions our team may have about the platform and how various metrics are performing. In 2018 we decided we should move to a self-serve solution where our staff could find out what they needed to know themselves. Thus, we found ourselves with Looker - a business intelligence platform that reports on every aspect of our business.