It is a universal truth that customers are the front of any company’s future earnings, however, due to how difficult it can be to quantify customer relationships, they are rarely found in quarterly earnings announcements.
While tangible assets such as property, equipment, and inventory, when damaged or impaired, have their depreciated values reflected on the company’s books, when consumers’ attitudes change negatively towards a company, this won’t be reflected in financial statements until much later – maybe too late? – when falling revenue is identified.
Some companies understand the importance of customer relationships and thus track customers’ attitude and actions similarly to how they keep track of finances. By linking customer feedback with business outcomes, these companies stay ahead of the curve and rely on new criteria when making investment decisions.
By ensuring customer data is accounted for regularly and making analytics rigorous, data can be reported to shareholders and be used to avoid bad profits and other actions that hurt customer relationships for the sake of short-term financial gain. The best way to future-proof a company is by investing in its most important asset: its customers.
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