The value of financial analysis

In the introduction to this guide we said that there was no such thing as finance — and this is where our meaning will become apparent. A financial analysis will not answer all your questions. But what it will do is raise intelligent questions and point you in the direction of others in your organisation who should know the answers. And if they don’t, you need to know why they’re not aware of the financial impact of their decisions.

Poor managers are often ‘anti-accountants’ because they hear accountants asking difficult questions. But it’s important not to shoot the messenger as he or she is only trying to resolve issues raised through financial analysis. The better organisation and the better manager would actually have informed the accountants beforehand that there may be issues in the business that will reveal themselves in the financial figures from analysis.