Imagine if you only got last month’s weather forecast, today. Utterly useless, right? No deciding what to wear, planning a picnic, or whether to bring an umbrella.

That’s exactly what it feels like when financial reports come in weeks late. By the time you get the numbers, the opportunity to fix mistakes or make timely decisions has passed, leaving you to scramble and play catch-up. (That is, if you’re able to read them at all.)

‍The thing is – most hospitality owners accept this as normal.

They see it that way because, within the traditional accounting industry, it is normal. When’s the last time your accountant apologised for delivering your financial reports 4 or 6 weeks after the month-end close?

Just like a stale weather report, delayed financial data can hinder your ability to steer your business effectively. It makes decision-making very difficult. And ultimately, it can jeopardise your business's long-term survival.

So, today we’re going to explore why reporting lags are so common and dive into some practical solutions to help you overcome these financial reporting delays.

Why Reporting Lag Occurs

Several factors influence the timeliness of financial reporting. According to a survey of 1,000 UK-based finance professionals,

‍“The biggest cause of delay in preparing and submitting month-end financial reports is unreliable data (18%) and the need to work across multiple incompatible systems/data points (17%).”

The same study reveals that another big factor is the lack of internal resources (17%), “an issue exacerbated by the limitations of current systems.” It adds that “companies are also restricted by missing data (12%) and the reliance on many slow manual processes (11%).”

These survey results really shine a light on the common obstacles businesses encounter when trying to get timely financial reports. Unreliable data, incompatible systems, and manual processes are major roadblocks, making it tough for finance teams to put together accurate reports quickly.

And yes, you guessed it right, in the hospitality industry these challenges are even more pronounced. This is because restaurants and other hospitality businesses face unique issues that can exacerbate delays in financial reporting, like:

High transaction volumes
Multiple revenue streams
Inventory management and control
Third-party vendors and suppliers
Reliance on manual processes

All of these factors combine to slow down your accountant, making it hard to deliver timely and accurate financial reports.

Why Should You Care?

You may be wondering, “Why the fuss about financial reporting? Is it so bad that I have to wait a few weeks?”. Well, it’s not just about waiting. Delayed financial reports can significantly impact your business in several critical ways:

Missed Opportunities: When a golden opportunity knocks, you need to answer immediately. Without up-to-date information, you might miss out on opportunities to cut costs, invest in growth, or pivot your strategy. Timely financial data is crucial for making informed decisions.
Cash Flow Crunch: Delayed financial reporting blinds you to liquidity issues, potentially leading to a cash crunch. Something you want to avoid like the plague. Knowing your financial position in real time helps you manage cash flow much more effectively.
Tax Troubles: Delays can increase the risk of non-compliance. Without accurate and timely financials, you're essentially flying blind. And trust us, Mr. Taxman doesn’t give any breaks. Delays can result in penalties, interest, and that uninvited guest – an audit.
Stakeholder Trust: Investors, creditors, and other stakeholders rely on timely financial information to make decisions. Consistently late reports can erode trust and confidence in your business.
Stress and Uncertainty: Just as guests feel uneasy in a restaurant with a messy service structure, your team – be it management or staff – will feel the stress of financial uncertainty. Timely reports bring clarity and peace of mind, helping everyone stay focused on what they do best.

3 Ways To Overcome Financial Reporting Delays

So, it’s time to have a look at how you can overcome these problematic delays. Remember, unless you’re willing to actually make changes to your current setup/processes, you’ll be stuck with ineffective financial reporting. Here are a few options:

1. Talk to Your Accountant

The first step to consider is to schedule a meeting with your accountant. They're equipped to dive deep into the numbers and can often pinpoint where the hold-ups are happening. If you’re able to identify possible bottlenecks, your accountant may be able to suggest ways to streamline the workflow.

Try working together with your accountant to review and optimise your financial reporting processes. They may recommend adjustments to improve efficiency and reduce turnaround times.

Although your accountant can provide insights and potentially suggest some temporary fixes, keep in mind that this approach usually doesn't address systemic issues such as outdated systems, reliance on manual processes, and lack of integration.

It can also be quite time-consuming and costly, especially if it leads to frequent meetings or continuous back-and-forth communication. In the worst cases, it might just put a plaster on a problem that needs a more strategic solution.

2. Integrate Financial Reporting Tools

Another common approach when facing delays is to integrate financial reporting software. Some are already available inside accounting software that you may use, like Xero, Quickbooks, and Sage. But, these can be limited.

You can also buy a specialised financial reporting tool as an extra. These tools can automate many of the tasks that are traditionally done manually, potentially speeding up the entire process.

They often come with features like real-time data processing and analytics, which can definitely improve efficiency. You should look for a tool that has strong automation features, can integrate with your existing accounting systems and software, and is user-friendly.

But here’s the snag: they require an investment in terms of both money and time – time to train your team, tweak the system to your needs, and maintain the software. And if the tool isn't a perfect fit for your specific business model, it might end up complicating the processes even more.

Unfortunately, these tools still require a lot of your input. You have to plug in all your financial information, set up your banking details, connect with your accounting solutions, and learn how to read the reports, which, as a busy hospitality owner, just adds another layer of complexity.

3. Switch to Outmin

Now, if you want to fix the systemic problems that lead to reporting delays with minimal hassle, switching to Outmin is your best bet.

Outmin isn’t just another tool. It’s an automated accounting solution designed to eliminate accounting and bookkeeping from your task list while providing hyper-accurate, easy-to-read cash reports that update every night. And it’s made specifically for hospitality businesses.

Outmin isn’t just another tool. It’s an automated accounting solution designed to eliminate accounting and bookkeeping from your task list while providing hyper-accurate, easy-to-read financial reports every single week.

The reason why this is your best option is that Outmin departs from conventional accounting processes, operating on a completely different “wavelength” – it’s much faster, much more accurate, and eliminates all friction between disparate systems because it’s an all-in-one solution.

It’s the only way you can actually fix the root causes of financial reporting delays. And with Outmin, you’re not just overcoming delays; you’re setting a completely new standard for efficiency in your financial operations.

You also have the benefit of being able to chat with an accountant anytime you have a question, either in-app or through your preferred messaging platform.

Businesses like Pi Pizza or Devour Bakery have greatly benefited from Outmin’s superfast financial reporting and have been able to save a significant amount of time and money.

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Ditch The Delays, For Good

Addressing financial reporting delays requires a proactive approach. No way around it. Considering the options available is crucial, but it's important to recognise that some solutions might only offer patchwork fixes.

For instance, working with your accountant or buying more financial reporting tools can give you temporary relief but often don’t address deeper systemic issues like outdated systems or reliance on manual processes.

Working with your accountant or buying more financial reporting tools can give you temporary relief but often don’t address deeper systemic issues like outdated systems or reliance on manual processes.

Outmin, however, goes straight to the root causes of financial reporting delays. It eliminates the need for traditional accounting processes by offering a seamless, all-in-one solution tailored specifically for hospitality businesses. By switching to Outmin, you’re not just patching up problems – you’re transforming your financial operations with accurate cash reporting insights and KPIs.

‍Ready to leave financial reporting delays behind? Book a demo to see Outmin in action for free and discover how we can help you. Let’s chat.

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