Performance Measurement and Improvement System (PMI)

73% of accountants say that there are five or more fundamental flaws in annual accounts. They:

1. Don’t make easy reading
2. Don’t show how well they are doing compared to others in their industry
3. Don’t identify strengths and weaknesses
4. Don’t calculate the scope for improvement
5. Don’t support decision making

In 2004 the ICAEW said:

"Every aircraft in the world today would be grounded if air traffic control relied on the same type of system as companies use today to report their information… current reporting formats provide too little, too late…"
Quoted on page 10 – New reporting models

Accountants are the numbers experts, but AVN accountants don't just measure and accept the numbers - we actually help change the numbers.

Poor information means that businesses ....

• Don’t have finger on pulse
• Don’t spot problems soon enough
• Miss opportunities
• Make bad decisions
• Less successful than they should be
• May even fail

• We can’t change GAAP accounts
• They must be 100% compliant
• And most clients don’t want to disclose more than they need to
• So we need to continue producing 100% compliant GAAP accounts

But instead of stopping there…

Add a second "Confidential Performance Report"
for management’s eyes only that…

1. Compares (ie benchmarks) them against the rest of their industry
2. Uses those benchmarks – and graphs, ratios and plain English - to explain how they are really doing
3. Identifies their strengths and weaknesses
4. Calculates how much better they could be doing by learning the lessons of their best competitors
5. Sets out an action plan for improvement  

But even that is

 not enough!

PMI is...

• An 8 step Performance Measurement System
• Codifying best practice
• To give to clients in a binder
• So that they can
• File their key numbers in one place
• Recognise the gaps in what they currently do
• Start following best practice

The 8 steps are.....

1. Forecasts and budgets
2. Monthly performance
3. Annual performance
4. Trends and ratios
5. Benchmarking
6. Business valuation
7. Improvement potential
8. Improvement plan

Want to know how we can help: Contact us