How to Manage Complexity in Finance

Without a system, finance and accounting leaders struggle. We can be doing a great job for one company, position, or client, then fall flat on our faces at another. Most commonly, we fail when we attempt to replicate systems and processes without really understanding what's important. Or, we focus on one area of finance (maybe the ones we like) when other areas need similar attention. I see accountants that fail to strategize, finance, and forecast. I see FP&A professionals with a lack of understanding or bias against accounting. But, it's all related. Failures in one area are manifest in other areas. Financial leaders need to create holistic strategies that unify all areas of finance and accounting. I teach professionals to focus on all areas of finance: Strategy Financing Forecasting Reporting Controlling Bookkeeping When I step into a new client, I conceptualize the system top-down. In other words, I first spend time creating the strategy. It usually doesn't take significant analysis to figure out where the problems and opportunities are. Usually, the key players are more than happy to share with me what it is they want to do and why. Then, I use simple modeling to figure out how to do what they want (or to suggest other options). Sometimes financing is required, whether debt or equity, which come with requirements that I must build out. Once I see how to do it, I identify the key lead and lag indicators to support the strategy. That guides the reporting requirements and the associated analyses. I then evaluate the accounting, making changes to how we measure, track, and score. Usually, at smaller organizations, I need the accounting team to be more active in controller- and FP&A- type functions. I need to free up their time. By simplifying the accounting, their work can be streamlined to provide time for more valuable efforts that really support strategy. I walk through all processes to gain an understanding of where changes can be made. All of which I just described is done in the conceptualization phase. This usually takes a 1-3 months. Then, we begin building. Although many of these areas can start simultaneously, it's best to focus one and a time from the bottom up. Without good accounting, you can't have good FP&A Without good FP&A, you can't support good strategy (and obtain financing if necessary) The buildout phase commonly lasts 3-6 months. It's important that the initial systems and processes around each section are simplified so the strategy can operating within the limits of the resources and capacity available at the time... ...including and especially yours!

This might rub a few data people the wrong way: (But I'll say it anyway) The argument that complex business logic has no place in your data architecture is not always practical. Sometimes, it's impossible to avoid complexity. For example: 1. Difficult data integrations with a source system's poorly constructed data models 2. Being forced to work on backend source system data of poor quality without having the ability to influence and guide the business process that generates the data (seen in some bigger corporations) The key in such scenarios is to 𝗺𝗶𝘁𝗶𝗴𝗮𝘁𝗲 𝗰𝗼𝗺𝗽𝗹𝗲𝘅𝗶𝘁𝘆 𝘄𝗵𝗲𝗿𝗲 𝗽𝗼𝘀𝘀𝗶𝗯𝗹𝗲. So, here's how to manage complex business logic in your data architecture: 𝟭/ 𝗦𝗶𝗺𝗽𝗹𝗶𝗳𝘆 𝘁𝗵𝗲 𝗹𝗼𝗴𝗶𝗰 (𝘄𝗵𝗲𝗿𝗲 𝗽𝗼𝘀𝘀𝗶𝗯𝗹𝗲) The first step in managing complexity is to simplify where you can. Break down large, intricate processes into smaller, manageable components. Modularizing logic makes it easier to troubleshoot, maintain, and update over time. 𝟮/ 𝗖𝗲𝗻𝘁𝗿𝗮𝗹𝗶𝘇𝗲 𝘆𝗼𝘂𝗿 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗹𝗼𝗴𝗶𝗰 Rather than scattering business rules across different tools and platforms, consolidate them in a central semantic layer or data warehouse. This ensures a single source of truth, minimizing the risk of inconsistent data and redundant efforts. 𝟯/ 𝗕𝘂𝗶𝗹𝗱 𝗳𝗼𝗿 𝗿𝗲𝘂𝘀𝗮𝗯𝗶𝗹𝗶𝘁𝘆 Whenever possible, design your logic to be reusable. This reduces the need to rewrite complex rules across multiple reports or dashboards. It also saves time and lowers the likelihood of errors creeping in. 𝟰/ 𝗜𝗺𝗽𝗹𝗲𝗺𝗲𝗻𝘁 𝘃𝗲𝗿𝘀𝗶𝗼𝗻 𝗰𝗼𝗻𝘁𝗿𝗼𝗹 With complex logic, changes are inevitable. Implement version control practices to track updates and ensure everyone is working from the latest iteration of business rules. 𝟱/ 𝗙𝗼𝗰𝘂𝘀 𝗼𝗻 𝗱𝗼𝗰𝘂𝗺𝗲𝗻𝘁𝗮𝘁𝗶𝗼𝗻 𝗮𝗻𝗱 𝘁𝗿𝗮𝗻𝘀𝗽𝗮𝗿𝗲𝗻𝗰𝘆 Document your business logic thoroughly. Transparent documentation makes it easier for teams to understand the logic over time. This reduces knowledge silos and improves long-term flexibility. 𝗨𝗹𝘁𝗶𝗺𝗮𝘁𝗲𝗹𝘆: The discussions need to move from avoiding complex logic to seeing how it can be correctly implemented. Why? Your data architecture will never be wholly rid of complexity. - Simplify where possible - Centralize logic - Build systems that are adaptable and scalable for the future. P.S. Do you agree?

Inefficient finance departments cost COOs more than they think. (But fixing it takes less time than they’d expect.) Most COOs we work with swear their finance team is “fine.” Then we jump on a deep-dive call and find: → Month-end closes take 2 weeks (not 3 days) → CPA bills 30% higher (thanks to messy books) → The team’s always firefighting (not strategizing) Here’s the hard truth: Your finance team isn’t slow. It lacks structure and clear processes. After auditing 150+ small business finance teams at Books at Ease, one pattern keeps emerging: Talent can’t compensate for missing processes. The Fix? Structure Over Talent. Every. Single. Time. Here’s what you need to do to fix this: Segregate duties → Stop letting your accountant play admin. Lock in rhythms → Weekly syncs prevent month-end chaos. Document workflows → If it’s not written, it’s not real. Real example: One client shortened their month-end close from 14 days to 4 by clarifying roles and adding a simple checklist. Great teams aren’t born. They're built P.S. Share this if you think it will be helpful to someone in your network. ♻️ Structure beats talent? Or do you think I'm missing something? Let's debate in the comments 👇 — Ana

33% of CEOs don't trust their CFOs. The 5 areas I focus on (first 90 days): 𝟭) 𝗥𝗲𝗱𝘂𝗰𝗲 𝗘𝘅𝗽𝗲𝗻𝘀𝗲𝘀 The first thing I do with a new client is lower their expenses. This provides a quick win and frees up resources. Common cost-cutting opportunities I see: • Extra licenses • Unused subscriptions • Costs that feel worth it but are not –– 𝟮) 𝗦𝗵𝗮𝗿𝗲 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝗖𝗹𝗲𝗮𝗿𝗹𝘆 If the books are messy → I clean them up. If the books look good → I put together the core financial statements and make sure everyone understands them. I like to involve the whole team by opening the curtains wide on the company’s financials. This increases trust and accountability. –– 𝟯) 𝗢𝗽𝘁𝗶𝗺𝗶𝘇𝗲 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗲𝘀 I work with clients to streamline: A) Invoicing Many of the cash flow issues I see with clients can be traced back to slow collections. So I make sure invoices are going out in the correct amount and in an easy-to-understand format. B) Closing the books faster I understand the urge to close the books and move on. But clean books don’t mean much if you don't study them shortly after closing. That’s where I work with clients to get their books ready in about half the time. The result is ample time for reviewing performance. C) Monthly financial reviews A good financial review = meeting with the accounting team to study the P&L and Balance Sheet and investigate any budget variance Your goal is to explain each variance and put together an action plan to reverse any concerning trends. –– 𝟰) 𝗖𝗿𝗲𝗮𝘁𝗲 𝗮 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗣𝗹𝗮𝗻 We set goals and KPIs, determine what’s doable, and come up with a specific roadmap. For your strategic plan to work, it needs to tie back to the financials and be broken out into manageable steps. –– 𝟱) 𝗜𝗺𝗽𝗿𝗼𝘃𝗲 𝗖𝗮𝘀𝗵 𝗙𝗹𝗼𝘄 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 I’ve yet to work with an SMB that didn’t have any room for improvement here. Collections tend to cause the lion’s share of cash flow issues. But clients often overlook the other side of the equation: when and how they pay their own bills. It’s pretty common for owners to pay bills as soon as they get them. But I don’t recommend it. It's better to wait until the day they’re due and set them up for autopay. This way you keep cash in the business longer without running the risk of dinging your credit. Took me a LOT of scrambling in my early days to have this clarity... But after helping over 75 SMBs, I feel confident these are the first steps a CFO should take with a new client. If you enjoyed reading this, let me know and follow me for more strategic finance, SMB, and business content. — Need help with your finances? Feel free to send me a DM. Always happy to help.

Imagine inflating your income accidentally. One wrong move, and your entire financial picture crumbles. Here are some revenue stats you should know: - 20% of businesses waste time fixing revenue errors (EY). - Potential fines of up to $1 million for incorrect revenue recognition (PwC). - 35% of small businesses face cash flow shortfalls from misreported revenue (U.S. Bank). The risks are catastrophic: - Misleading investor presentations - Incorrect tax submissions - Potential regulatory investigations However deferral accounting can help you with matching the revenue recognition. Here’s how: 1. Identify Revenue Streams - Map all income sources - Categories by recognition timing - Avoid lumping different revenue types together. 2. Create Detailed Tracking System - Use robust accounting software - Implement strict documentation - Track performance obligations meticulously. 3. Establish Recognition Criteria - Define precise revenue recognition rules - Align with GAAP/IFRS standards - Create a clear documentation process. 4. Implement Systematic Deferrals - Set up separate revenue accounts - Track unearned revenue separately - Update monthly with precise allocations. 5. Regular Compliance Audits - Quarterly internal reviews - Cross-check documentation - Validate revenue recognition methods. Deferral accounting transforms financial complexity into strategic clarity. You'll know exactly where your money comes from and when it's truly earned. #deferralaccounting  #financeandaccounting   #business

Recently, I met with a fractional CFO who runs finance for over ten companies. He’s not new to this. He’s tried every “next-gen” platform out there. He’s lived through the pain of implementation, the frustration of learning new formula languages, and the endless cycle of mapping data fields that never quite line up. So why does it still feel so hard? As we talked, the answer became obvious. Most finance tools are still stuck in the past - just with a shinier coat of paint. 1. The old playbook: Learn a new formula syntax. Spend weeks (months) integrating systems. Hire analysts to build and maintain models. Hope nothing breaks. Fork over 250k in implementation services. 2. The “modern” playbook: Add a dashboard. Layer on scenario planning. Target fancy SaaS logos, but don't service the 90% of the market that needs help the most. Still expect you to write offset formulas and chase down syntax errors. 3. The future: Speak in plain English. “Grow revenue by 30% next quarter. Hire one CS rep for every 50 customers, three months ahead.” The system understands, builds the plan, ties it to real data, and explains every step - no formulas, no black box, no new language to learn. Gives every business the power of enterprise-grade planning. This CFO doesn’t want another tool that makes him do what he already does in Excel, just with more friction. He wants to run a $100M business without an army of analysts, because the tech finally lets him focus on what matters. He’s not alone. Every finance leader I meet is tired of spending 80% of their time on the last 1% of detail no one cares about until IPO. The lesson? The future of FP&A isn’t about making old processes faster or prettier. It’s about completely reimagining the process - where unified data and AI-driven automation make complexity invisible, and finance teams finally get to work on the business, not just in it. Are we just building faster horses, or are we ready for something completely new?

Over the past 12 months, I’ve helped 50+ CFOs optimize their treasury function. I’ve also enjoyed conversations with hundreds more finance leaders and treasurers who are trying to troubleshoot cash flow management and visibility issues. In that time, I’ve identified 5 common problems that keep most of these companies from running a more strategic treasury team. I call these the Cash Control 5 (because naming things helps). Solve these, and you unlock real operational efficiency and strategic financial gains. PROBLEM 1: Manual Processes Still Dominate Treasury Too many finance teams ➜ still stuck in Excel workflows for reporting, reconciliation, and forecasting. This consumes hours of work and increases the risk of human error - 2 things you don’t want. PROBLEM 2: Fragmented Cash Visibility Many bank accounts, currencies, and regions ➜ Low visibility into cash positions. This fragmentation creates blind spots that make decision-making slower and less reliable. PROBLEM 3: Inaccurate and Time-Consuming Cash Forecasting No proper tools ➜ manual / reactive top-down cash forecasting. Very limited granularity and visibility. Without an accurate, real-time view of cash flow, forecasting takes a LONG time. By the time the data travels up the chain of command, the data is often stale, making real-time decisions almost impossible. PROBLEM 4: Missed Opportunities for Cash Optimization Idle cash and inefficient working capital strategies ➜ missed opportunities. Whether it's optimizing investments or reducing costs, companies move too slowly because of poor visibility and limited insight into how to best allocate their cash resources. PROBLEM 5: Fear of Complex, IT-Heavy Implementations Many finance teams hesitate to adopt new systems, fearing the lengthy, resource-intensive implementation process. But modern solutions are faster and simpler to implement than most teams expect, often requiring little to no IT involvement. TLDR: 1) Manual processes → Slow down operations and increase errors 2) Fragmented cash visibility → Increase blind spots and slow decision-making 3) Reactive forecasting → Result in missed opportunities to optimize cash flow 4) Idle cash → Cost you money by sitting unused instead of used efficiently 5) Fear of complex implementations → Delay improvements that could free up resources and drive strategy Fix these 5 things, and your finance team can focus on what really matters: driving the business forward.

A few years back, I walked into a leadership review feeling bulletproof. We had just rolled out a new finance ops system. It was sleek. Integrated. Expensive. The kind of setup that made it look like we had everything figured out. Slide deck loaded. Dashboards crisp. KPIs auto-updating like magic. Then halfway through the presentation, our COO squinted at the cash flow projection and asked: “Why is accounts payable reversing in Q3?” I blinked. Then blinked again. Turns out, the automation rules in our shiny new system were duplicating vendor prepaids—because someone had toggled a sync setting during implementation. A few lines of code gave us two versions of the truth, and neither was right. It reminded me of giving a toddler a chainsaw. Just because the tool is powerful doesn’t mean it’s helping. Here’s what that mess taught me: => 1. Simplicity is not a lack of sophistication—it’s clarity. A lean system forces you to understand the mechanics before you automate them. Complexity doesn’t equal competence. => 2. Finance ops isn’t about tech. It’s about truth. You don’t need 17 dashboards. You need one that’s right. Start with clean data, tight processes, and a team that knows where the bodies are buried. => 3. Every tool adds friction if it’s not aligned with process. Adding more tech without a clear objective is like adding wings to a car and expecting it to fly. Now it’s just heavier and still can’t leave the ground. => 4. If it takes 10 clicks to validate a number, your team won’t check it. That’s how errors slip through—buried in layers of abstraction, hidden behind UI. => 5. Most finance problems are process problems in disguise. Tech can speed up your work, but it can’t fix bad habits. It just automates the chaos. => 6. Don’t be dazzled by dashboards. Look under the hood. If your reconciliations are manual and your assumptions are guesses, no tool is going to save you. => 7. When in doubt, build a better process, not a bigger stack. The most effective teams I’ve worked with ran on shared logic, tight spreadsheets, and ruthless version control. So now, before I recommend a new platform or workflow tool, I ask one question: Are we solving the problem or decorating it? If your finance ops feel overengineered, underperforming, or just...exhausting—what would happen if you cut half the stack and doubled down on process?

Building agentic workflows in financial services is no walk in the park. The complexity isn’t just about chaining prompts, it's about navigating legacy systems, stringent compliance, multi-step decision paths, and low-latency, high-stakes environments. You're not just building an agent. You're orchestrating memory, reasoning, tool use, policy enforcement, and explainability, in an industry that doesn't tolerate hallucinations or downtime. 💥 The problem? Most agents break down when exposed to real-world financial workflows—be it underwriting, fraud detection, or customer servicing. 🔧 The solution? We need a full-stack, production-grade approach: ✅ Scoped memory (with auditability) ✅ Reasoning with fallback planning ✅ Secure tool orchestration ✅ Multi-agent design patterns ✅ Real-time evaluation and policy guardrails 📌 Key takeaways: Prompt chains alone won’t survive financial systems Agentic workflows need to be composable, monitorable, and fail-safe Governance, latency, and trust are non-negotiable Evaluation is as important as generation If your agent can’t explain its reasoning, log every action, recover from failure, and meet compliance thresholds, it's not ready for finance. Sharing my latest take: https://lnkd.in/gme8xniR

Growing businesses often make this costly mistake: As your company scales beyond $10M in revenue, the financial complexity doesn't just increase - it multiplies. What worked at $5M won't cut it at $10M. I've spent two decades working in finance and here's what's crystal clear: Finance isn't just about tracking numbers - it's about making strategic decisions that impact every aspect of your business. Especially these days. You need more than just basic bookkeeping. You need sophisticated financial planning that can: - forecast cash flow across multiple revenue streams - analyze customer acquisition costs at scale - track profitability by product line - model different growth scenarios Recently, I worked with a $15M company that uncovered $800K in untapped profit potential they weren't seeing. Stuff that would have easily been unseen if they did not have someone properly look at their finances. Here's what robust FP&A (financial planning & analysis) delivers as you grow: - strategic resource allocation - early warning systems for potential issues - data-driven decision making - clear visibility into performance metrics The bigger your business gets, the more critical FP&A becomes. It's not just about tracking where your money went - it's about understanding where it should go next. #financialpuzzlessolved #finance #growth