I took my own advice and fired myself!
I am no longer the CFO, bookkeeper, financial data entry person or anything. That’s good because I was terrible at it.
One of our core partners put himself in a position (quit his job), to take over the books, but more importantly, become the CFO.
After he gets his number legs and creates his rhythm of entering the deposits and breaking the income down between rental income, late fees, retail sales, and so on; his first executive job is to do what the COO is doing: creating a financial procedural manual.
Who closes out the facility? Where does the money go? (Remember we get between 12% and 30% cash depending on the facility). Who makes the deposits? Who enters the books? Who writes the checks? Who signs the checks?
I did not realize it at the time, but on more than one occasion, the facilities I have purchased had a bookkeeper taking money prior to my purchase. The Owner did not really understand how much money they were, or were supposed to be taking in.
Most Owners are thrilled like I am when they can turn the books over to “a professional”. Just remember it does not stop there. You are the CFO, and you are accountable for all of it.
Best practices are when the Manager closes out the facility and matches up cash, checks, and cards at closing. Any deviation between what is reported and what is actually there’re should jump out. Prompting a big red flag on the closing reports. The Manager should explain. Even ask questions when you know the answers so that a Manager sees you really do look at the closing reports. The Manager does not make the deposit.
The person making the deposit and entering the financial data in QuickBooks, or whatever financial program is being used, does not sign the checks.
The check signer is the final check on the process and in our case, if the check is over a certain amount, it takes two check signers.
Get this documented and entered in the Operations Manual so that all facilities (even if you only won just one now) will do the same thing. Then STAY ON TOP OF IT.
I am shocked at the amount of theft that goes on at this level. Way more than the “shrinkage” off the shelves. Protect yourself, your business, your investors, and your customers, by having adequate safeguards and procedures in place for the financial procedures and reporting of your company’s financial health.
