According to a global survey released by Basware, a developer of cloud-based e-invoicing and payment software, 53 per cent of small businesses owners and 59 per cent of medium-sized business owners believe responsibility for setting budgets, controlling payments and determining the company’s financial strategy lies with senior management, but one in three senior managers say they’re unprepared to take on the role.
The Basware survey of 558 business owners and 1,368 employees worldwide with financial responsibility for SMBs found that, with financial responsibility being handed down from owners to senior managers, a greater understanding of the role is needed if they are to complete it successfully.
According to the results, 45 per cent of SMB senior managers have yet to receive formal financial training, and 57 per cent of board members are untrained.
Within micro-businesses, business owners are less likely to hold other members of their organization responsible for finances. More than half of micro-business owners (56 per cent) said they were responsible for financial processes, with 27 per cent delegating to board members and 17
Fifty-six percent of micro-business owners state that nobody else within their company is expected to engage with financial processes, with board members (27 per cent) and senior managers (17 per cent) occasionally being trusted with finances.
“In a tough economic climate, SMBs are often competing against larger companies and have to make tough decisions about the control of finances within their organizations as they pursue growth. The SMB Finance research suggests that, regardless of their location and size, all SMBs need to take a hard look at the effectiveness of their finance function, which plays a big role in the overall effectiveness of their companies and their ability to grow,” said Bob Cohen, vice-president of marketing with Basware, in a statement. “Currently, financial expertise is missing where it really counts, and these discrepancies highlight a need for greater attention to financial needs, processes and focus on how employees are expected to take control of a role for which they have not been trained.”
