Financial risks range from having adequate capital to deal with the business dynamics to proper accounting and reporting of financial performance. These risks can be easily controlled via proper funding to eliminate the capital issues and using well educated and trained staff to deal with the accounting and reporting requirements. The goal of financial accounting and reporting is reliance on the tenant of accounting which states: “Good information input maximizes the probability of good information output for the decision aspect of business operations”. In effect, it is difficult for the owner of a small business to make good decisions without the proper information. An owner can by accident make a good decision with poor information. It is highly unlikely but remotely possible.
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