As a wedding professional, you’re an expert in creating unforgettable moments. But how often do you take a moment to audit your business’ finances? A financial audit is a crucial tool for identifying growth opportunities and improving profitability. In today’s blog, we are sitting down with Geily Romero, Fractional CFO & Accountant from Cutting Edge Financial Solutions LL to gain some insight into specifically how financial audits can help take your wedding business to the next level. 

What specific financial aspects should wedding professionals consider when conducting an audit of their business?

“When we think about financial aspects wedding professionals should consider when conducting an audit of their business, the very first place to start would be their Profit and Loss Statement (P&L). Looking at their P&L, they should take a deep dive into their revenue, expenses, and bottom line (net income).”

How can a thorough financial audit help wedding professionals identify potential areas of improvement or growth within their business?

“Performing a thorough financial audit will either reveal areas where we’d need to cut back on, or areas where we’d need to make more, or both. That’s why two of the steps in a thorough financial audit are conducting an expense audit and a revenue audit. One is when we look at all the expenses and consider which are income-generating and which we could downgrade or cancel. The other is when we look at our revenue, work through revenue modeling, and strategize ways to diversify revenue streams. Performing both will help wedding professionals identify potential areas of improvement, maybe by cutting back, but also areas of growth by finding ways to generate more.”

Are there any common financial mistakes or pitfalls that wedding professionals often overlook that an audit can help uncover?

“Because wedding professionals are so busy, it can be hard sometimes to take some time and review their finances; it can also be overwhelming and daunting to even think about, which leads to avoiding it altogether until probably tax time. One of the biggest mistakes I see many make is leaving their finances unattended until it’s time to file taxes.”

What are some key financial indicators or metrics that wedding professionals should monitor regularly to ensure the financial health of their business?

“There are a few key financial indicators that wedding professionals should keep top of mind, such as gross profit margin (if they have cost of goods sold (COGS)), net profit margin, sales growth rate, and selling, general, and administrative (SG&A) ratio, among others.”

Can you provide examples of how an audit has helped wedding professionals make informed financial decisions or improve their profitability?

“An audit has helped wedding professionals make informed financial decisions and improve their profitability because it has given them a birds-eye view of their finances. It has allowed them to dig deep into all the aspects of revenue, exploring revenue modeling and diversification. It has also allowed them to review their expenses, identifying leaks and cashflow issues that have led them to their bottom line.”

Financial audits are not just about crunching numbers. They’re about gaining insights into your business’s financial health and using those insights to make strategic decisions that drive growth and profitability. So, take the time to conduct regular financial audits. It’s an investment that will pay dividends in the long run. Want to learn more from Geily and the importance of auditing your wedding business? Check out our exclusive Black Friday Special: The Bespoke Business Blueprint.