Last week, I had my 15 minutes of fame… In Yorkshire, at least!
I was interviewed on the telly for the first time and quoted widely in the local press.
And it all revolved around the accounts of one of my favourite clients, the North Yorkshire Moors Railway.
You see, heritage steam railways are a very seasonal business, and in winter they tend to spend a lot on maintenance and make very little money.
Given the state of the economy, when we produced the accounts for the year ending February 2023, we weren’t quite sure what the railway’s position would be at the end of the winter of 2024. We knew there were going to be challenges, but thought it would work out.
I carefully noted this in the accounts, because when the accounts are signed, the directors must believe the company will be able to trade for at least another 12 months, that it is a going concern.
And when the auditors reviewed the accounts, their own report highlighted this paragraph.
Of course, in the end all our worries turned out to be without foundation. We’re now at the end of the winter of 2024, and not only is the North Yorkshire Moors Railway still operational, it has good cash headroom. The railway is doing well!
Still, a journalist at a Yorkshire paper was recently handed a copy of these accounts. And their headline announced that we think we’re about to go bust.
The journalist seemingly didn’t understand the accounts, didn’t note that this was old information or provide any update on what’s happened since – and initially, didn’t ask us to respond.
Then the report got picked up by other regional papers and television stations… Oh dear.
That’s where I sprang into action as the railway’s Finance Director, clarifying the facts and emphasising the railway’s true, healthier position this winter.
I think we managed to turn this into a good news story. And perhaps I even got a few more people interested in the wonderful, unique experience of the steam railway? (It’s a great day out for the whole family – find out more here!)
So what can everyone learn from this?
First, many companies consider their accounts to be a formality that they can sign off without too much trouble, and then never think of again.
But these accounts actually enter the public domain, when they are sent to Companies House (charities also send them to the Charity Commission). Anyone can read them at any time, including potential customers and vendors, your competitors, employees and former employees – and yes, journalists.
So there’s an extra reason to get them right.
As it happens, we put a lot of thought into that paragraph about whether the railway was a going concern (ie a viable business for the next 12 months). We did our best to present the risk accurately but without being alarmist.
It’s a shame that the first journalist took the opposite approach, but the original accounts with their careful wording stood us in good stead in the end.
You need to make sure that the people preparing your own accounts take equal care and put equal thought into what could be sensitive matters.
Second, if the worst did happen and your accounts were subject to negative attention or press, could your own accountants spring into action at short notice to represent your company? Would they know the issues well enough, and be familiar enough with your company to speak publicly in your name – and guide you through it?
As the North Yorkshire Moors Railway example shows, we are intimately involved in the businesses we work with. We live and breathe their issues just like an in-house team, we understand them and can represent them.
That’s because our model is different to other accountants. We don’t just contact you once or twice a year, to get your accounts done. We work with you on a near-daily basis, to improve your financial management, increase your profitability and maximise your growth. It’s a completely different proposition.
If that’s the kind of financial help you’re looking for, why not get in touch with me today. Simply hit ‘reply’ to this article or call us on 01279 647 447 for a no-obligation chat about your financial management – and how we can help you.
Warmly,
Garry
