They Thought They Were Losing Money, Until They Looked at the Right Numbers

Today’s story is about two young business owners I met at a networking event, and how they went from worried founders to confidently growing their business.

At the time, they felt like they were struggling. One of them was even working a second job.  Every month, the reports they were getting showed a loss, and they believed they had no money to invest in staff to help the business grow.

But as I spoke with them, it became clear that the problem wasn’t the business, it was the information they were using to make decisions.

Their accountant was doing exactly what accountants are meant to do for tax and BAS purposes: reporting income when it was received and expenses when they were paid. That’s correct for compliance.

What that reporting is not designed to do is show how the business is actually performing month to month.

Here’s what had happened:

They had signed a major contract and the customer paid 12 months in advance. So, for tax, that first month looked fantastic — a big profit.
But every month after that, they still had all the costs of delivering the work, with no matching income showing in the reports. On paper, it looked like they were losing money every single month.

That monthly “loss” shaped how they felt about the business and the decisions they were making.

So, I reworked the numbers so the contract revenue was spread across the months when the work was actually delivered.  Which is what you need for decision-making.

The picture completely changed.

Instead of losing money every month, they had only one loss-making month. The rest of the time, the business was performing far better than they realised.

Next, we built a monthly rolling forecast (which we still update today).

That gave them visibility and confidence about what was coming, not just what had already happened.

The result?

They realised they could stop surviving and start planning.

They hired more staff.

And with the right people in place, they could finally grow.

The lesson here is simple but critical:

Tax and BAS reports are about compliance. Management reports are about running the business.

Both are important, but if you rely on compliance numbers to make growth decisions, you can end up holding your business back, even when things are actually going well.

👉 If your reports tell you what happened last quarter but not whether you can afford your next hire, your next major expense or your next growth step, it might be time to look beyond compliance numbers.

That’s exactly where ongoing forecasting and outsourced CFO support can make a real difference — turning your financial data into something you can actually run the business with, not just lodge with the ATO.

If this sounds familiar, happy to have a quiet chat.

Contact Wayne on wayne@arealcfo.com.au or 0412 227 052.

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Want a confidential discussion on your business situation, help with your grant application or to learn more about my Outsourced CFO Services, simply email me at wayne@aRealCFO.com.au or call me on 0412 227 052