am i making any money? how to set up your financial management system kevin kehoe...
TRANSCRIPT
Financial ReportingStart with the end in mind…
Financial ReportingApples to Apples to Compare…
Transaction FlowProcess to get useful reporting…
Estimate the Job
Schedule /
Time Sheet Job
UpdateComplet
e /Invoice the job
Purchase / Yard Tickets
Produce Financia
l Reports
Operations – Transactional AccountingFinancial Accounti
ng
Paperwork FlowHow to do it… integrated or not?
Use Estimat
e Spread sheetOr
Software
program
Use Schedule
Board and
Paper or Electronic
Monitor the job
with spreadsheets, Quick Books,
or Softwar
e Program
Invoice the job in Quick Books orSoftware Program
Use Purchase Orders and Yard
Tickets
Produce Financia
l Reports in Quick Books
The Quick Books Set UpStandard process…..
Create Service Items
Estimate in
Spread sheetEnter
Estimate in QB’s
and Create
WO
Create Schedule Board and use daily ticket to
keep time
Create Excel
Job/WO Tab… Enter
Hours by employee QB’s WO
and Material via PO to
WO (Direct v. Indirect Acct.)
Invoice the job
and cost in QB’s
Create PO’s in QB’s
based on WO Tab Actuals
from Estimate
Produce EOM/WIP Financial Reports
with focus on timing (invoices
– payments) in Quick Books (3 months)
▪ Estimate Accurately: Target NP% / GP% and accurate items counts with price controls
▪ Job Set-Up /Management: Reporting in “real time” not 15 days after month end
▪ Purchasing: Specific lists and costs to manage quantities and costs
▪ Labor: Specific Schedule Tickets with Hours Actual, Budget and Remaining
▪ Billing and Costing: Real Time Billing and accounting for WIP – even in Maintenance
Key Concepts To get the number right and the information worthy
▪ Industry Benchmarks:
These are OK but can also cause great confusion and lead to big mistakes – chart of account, process, geography and regional cost differences
▪ Your Budgets:
This is really the best benchmark – establish standard pricing systems (MORS, etc.) with controls and updated cost catalog of items (Materials and labor)
Using the Numbers To compare to a benchmark
Keys to Making Money What we have learned over the past 25 years..
1.Culture is everything: Focus on Better, Best. People are the problem and the answer. Hire and fire for it… until you get it.
2.Speed wins: Service response is better. Anticipation is best.
3.Information in “real time”: You can’t manage what HAS happened… you can manage what will.
4.Salesmanship: Yes nice landscape matters, but delivering value sells. The guy with the best mousetrap DOES NOT always win!
The Numbers:Chart of Accounts
The Numbers:Chart of Accounts