Success isn’t accidental. It’s the result people making good business decisions based on the best information possible. If you polled one hundred business owners, the vast majority would choose to have current, accurate and meaningful financial information on hand when making critical decisions. Yet despite this, many business owners view accounting and finance as necessary evils. They deprioritize collecting financial information and are often left playing “catch-up” for external reporting deadlines such as tax filings, and reports for banks and investors.

So why is there such a gulf between what business owners say they want and the reality of their actions? Poorly designed accounting systems and internal processes cause collection and reporting to be a distraction and a drain on company resources. When collecting information requires too much thought and effort, business owners frequently divert attention to areas that they consider to be more important. Essentially, they decide they should be “making money and not counting money.” While that general idea may have a lot of merit, getting to that point simply by neglecting financial record keeping can result in poorly informed decisions that negatively affect your long-term chances for success.

So how can you design and manage a financial reporting system that minimizes hassles and still provides the information that you need? It’s a lot simpler than you might think. Follow this simple three step process to achieve financial preparedness and drive more informed decisions.

1. Remove Recordkeeping Hassles with the Right Systems. If you want good information to drive your decisions, your accounting system must be set up to collect and report the information that you need. Every industry is different, and the performance indicators important to a manufacturer may not be as important to a shop owner. It is critical that you understand the numbers and ratios that are most important to your organization and ensure that your accounting system, whether QuickBooks or another system, is properly setup to provide you with the information you require.

2. Let Good Processes Drive Consistency. When opportunities arise, it is essential that you have your financial house in order. Whether someone is looking to buy your business or your see a strategic opportunity for expansion, up to date financials are critical to both your decisions and those of external stakeholders. Getting real-time information requires recording information in a timely fashion. Consistently inputting information in a timely and accurate fashion requires good accounting processes. How is information being gathered? Who is responsible for information at each step? How is your team being held accountable and what are your fail safes? Having a well-designed system for data input with reliable ways to monitor success and identify problems is critical. The better, more fool-proof your system, the less opportunity will exist for human error.

3. Fuel Insight with Information. The final piece of the puzzle is what truly drives success. It’s not enough to have the right information at the right time. You need to understand it in the context of your decision making. There’s no shortcut to getting this right. You have to be able to see trends, discover causes, and analyze and understand effects. Then you have to make decisions that will positively affect performance. Sitting down with a team of trusted advisors will help you get a broad perspective on your situation, allow you to see more opportunities and potential threats, and will ensure that your decisions are based on sounds logic and the circumstances as you know them.

Your Financial Transformation

If reading this blog has you questioning whether your financial reporting is positively affecting your decisions, now is the time to do something. Start by evaluating the design of your accounting system. Do you have the right software? Is it setup to collect and report the right information? Then take a look at your people and processes. Finally, look at how you are using the information you are developing. Consider consulting with your CPA or another advisor to ensure that your financial information is properly informing your decisions. Do these three things and your financials will fuel your future success.

– See more at Blog.FundingGates.com.