financial decisions

Small Businesses Rely on Old Data and ‘Mental Maths’ to Make Financial Decisions

Small Businesses Rely on Old Data and ‘Mental Maths’ to Make Financial Decisions

Small businesses are putting themselves at risk with almost half (44%) having based investment decisions on quick, mental mathematics (31%) or gut instinct (13%), a new report from KPMG Small Business Accounting has warned. 25% of small firms were also found to have relied upon four month-old data to make important financial decisions, while an additional 25% admitted to not knowing how much they could safely afford to invest in their business. Some of the decisions being made by firms without proper financial analysis included investment in new staff, equipment and marketing campaigns. The research, which featured 1,000 small business owners, also revealed that only a third of companies forecast income. All of the respondents admitted that they did not use a professional financial adviser... »