Is It Wise To Keep The Staff In The Dark On Finances?
November 7, 2015 
Do you have a financial-related question about your retail division? Send it to financial expert Steve Bailey at [email protected].
Question: My parents have always kept the accounting/books tight to the vest and have not allowed the financials to be entered or monitored by the garden center staff. At what point should that transition over to the garden center staff, and can you suggest a way I handle that with my parents? OwnAnonymous (for obvious reasons!)
Answer: In my opinion, the accounting should always be handled on-site by either family or staff. The disconnect between the money flowing in versus the money flowing out that is created by having the financials off-site creates both a feeling of helplessness and possibly a false sense of extreme profitability.
Besides the disconnect in your own minds, there is also a lost connection on the accounts payable side. If the staff is receiving inventory and the invoices are being paid off-site, there is a chance that accountability is lost between the delivery amounts and the paid amounts, which could add up over the course of a year to a substantial amount.
One other point to consider is the buy-in staff gives when they are involved with the numbers from the beginning. One of the benefits of having staff involved is that they are many times more protective of the owners’ money than the owners themselves.
Now, the tricky problem — how to approach the issue with your parents to begin (hopefully) the transition of moving the financials to the garden center staff. First of all, why are they holding onto the control of the financials? Do they still have a vested interest in the success of the garden center, or is it all just pride in a business they built to this point? Either way, they probably want to ensure that the business succeeds, and they may feel the only way to track the progress is if they control the money. A solution here would be to keep them in the loop by involving them in weekly meetings in which the financials are discussed.
The big issue here is, have you actually asked if they would like to get out from under the burden of doing the books? They might feel that if the garden center staff hasn’t asked, they must not want or feel confident enough to take on the task. You’ll never know until you ask, and you just might be surprised to learn that they might want to move on to the next level as well!
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