When business accelerates, the habits that worked at launch may no longer be enough. Invoices multiply, more people spend on the company’s behalf and hiring decisions commit several months of cash. Your processes need to develop before the accounts fall behind.
Key points
- Growth increases the need for financial monitoring, even when revenue is rising.
- Assign clear responsibility for collecting documents, approving spending, making payments and closing the accounts.
- Monitor short-term cash flow and funding needs over the coming months.
- Automate repetitive work while keeping checks on data and permissions.
Spot what no longer works
Unapproved supplier invoices, scattered receipts and figures arriving two months late point to an organisational problem. Headcount is not the only measure: a small team can process a high transaction volume.
Map the flows: sales, subscriptions, purchases, expense claims, payroll, online payments and cross-border transactions. Identify duplicate data entry and tasks with no clear owner.
This review helps you decide what to automate, delegate or check differently. Buying more sophisticated software without clarifying the process often just moves the problem.
Growth also creates more decisions to coordinate
At the start, the founder knows every invoice and customer. As sales and the team grow, that personal knowledge is no longer enough. One person may commit to a purchase, another may pay it, and accounting may discover it several weeks later.
Define who may commit to spending, who approves it and where supporting documents belong. Set a rule for recurring commitments too: recruitment, annual subscriptions, subcontracting and new premises. Their effect extends beyond this month’s payment.
You do not necessarily need a complex system. A clear process people follow is more valuable than a detailed procedure they ignore. The aim is to know what has been committed and produce figures early enough to make decisions.
Define responsibilities and secure payments
Specify who orders, checks delivery, approves the invoice and releases payment. Where team size allows, avoid letting one person create a supplier, change its bank account and approve its payment without an independent check.
Set spending limits and a process for exceptions. Verify changed bank details through a previously known contact channel: simply replying to the email announcing the change is not an independent check.
Define software access, backups and export options too. A team member leaving or a change of provider must not prevent access to your accounts.
Introduce a regular month-end close
A proportionate monthly close gives you a basis for decisions: bank balances reconciled, outstanding invoices checked, significant costs recorded in the right period and unusual items explained.
Set a deadline for documents and another for the figures. A few reliable metrics available on time are more useful than a detailed report delivered too late.
The year-end close then becomes easier because errors have not accumulated for twelve months. Unusual transactions still need to be discussed with your accountant or accounting firm.
An annual subscription payment is not always immediate annual revenue
A startup receives CHF 24,000 for a service delivered evenly from October to September. This fictional example excludes VAT. The revenue represents CHF 2,000 of service each month.
By 31 December, three months have been delivered: CHF 6,000 belongs in the current financial year’s income statement. The remaining CHF 18,000 relates to the following year and is recorded as deferred income within liabilities. The bank account, however, has already received CHF 24,000.
This calculation assumes an evenly delivered service over twelve months. If the contract also includes installation or several distinct deliverables, their accounting treatment needs separate consideration.
A simple monthly timetable to agree with the team
These are working targets to adapt to the startup’s volume, not statutory deadlines. “Day 0” means the last day of the month.
| Target | Work | Expected result |
|---|---|---|
| Day +3 | The team submits invoices, expense claims, new contracts and payroll information. | Missing documents are identified, with someone assigned to obtain them. |
| Day +5 | Accounting reconciles the records with bank statements and checks customer and supplier balances. | Unidentified payments and old invoices are explained. |
| Day +8 | Accounting allocates income and expenses to the correct month and checks payroll and VAT. | A coherent monthly result and a list of issues still to resolve. |
| Day +10 | Management reviews the figures, commitments and cash flow forecast. | Two or three decisions with deadlines and a named owner for each. |
Forecast cash before committing to growth
Prepare a weekly forecast for the weeks ahead, for example thirteen weeks, and a longer monthly outlook. Include salaries, social security contributions, VAT, investments and customer payment terms.
Net burn rate is the cash used each month: cash outflows minus inflows. Runway is how long the available cash will last. With CHF 120,000 available and net cash consumption of CHF 20,000 a month, runway is six months if the rate stays constant. A new hire or loan repayment changes the calculation, so also consider upcoming payments.
The buffer you need depends on sales volatility and access to funding. A blanket three- or six-month rule cannot replace your own scenarios. See our cash flow management approach to organise warning signals.
Recalculate runway after every major commitment
In a Swiss limited company (SA/AG), the board must monitor the company’s ability to pay its debts and act promptly if that ability is at risk (Article 725 of the Code of Obligations, CO). The rules also apply to an LLC’s managing directors through Article 820 CO: monitoring cash flow helps trigger the necessary measures in time.
Cash of CHF 120,000 and a net burn rate of CHF 20,000 a month provide six months of runway in a constant scenario. If a hire increases net burn to CHF 30,000 from month three, the picture changes.
After the first two months, CHF 80,000 remains. At the new rate, that covers approximately another 2.7 months. Total runway is therefore around 4.7 months, rather than six, in this simplified model with no other changes. Actual payment dates may further affect the lowest cash balance.
The hire may be worthwhile, but its funding needs to be clear before signing. Connect the cost to what it should enable: production capacity, customer acquisition, development of a feature or reduction of a risk.
For the monthly review, bring together profit and loss, forecast cash flow, significant receivables and new commitments. Explain variances from the budget. Investors and managers need to understand why the figures change, rather than simply receive a larger report.
Sales growth and profit: understand the difference
This French-language video by Sarah and Romain explains revenue and profit. It provides a useful foundation for reading startup metrics; cash flow still needs its own forecast.
Explore the Entreprendre en Suisse channel with Sarah and Romain →
Choose a few metrics suited to your business model
Track revenue, margins, overdue invoices and available cash. A product business should add inventory turnover; a subscription business can track recurring revenue and cancellations using consistent definitions.
Distinguish growth from profitability. An additional sale can consume cash if you need to buy stock or finance several months of work before payment. Review your working capital requirement as well.
Compare actual results with the budget and explain variances. A metric is only useful if someone knows what decision to make when it deteriorates.
For subscriptions, separate recurring revenue from cash receipts
A startup can announce more contracts while receiving less cash immediately, for example when switching from annual to monthly billing. To understand the change, separate the recurring value of contracts, revenue recognised in the accounts and bank movements.
Monthly recurring revenue (MRR) expresses subscription revenue on a monthly basis. Suppose opening MRR is CHF 10,000. New customers add CHF 2,000, expansions of existing contracts add CHF 500 and cancellations remove CHF 1,500. On a consistent basis, closing MRR reaches CHF 11,000. Net growth is 10%, whereas new subscriptions alone might suggest a stronger result.
Define what the metric includes: active subscriptions, discounts, pauses, variable billing or one-off services. A non-recurring installation fee should not automatically increase MRR. Reconcile the commercial metric with contracts and the accounts, explaining differences in timing.
Consistent definitions make discussions with co-founders and funders more useful than a growth figure whose scope changes every month.
Adapt your team and tools without doing everything in-house
Start by deciding who keeps the accounts and who reviews them before hiring or delegating more work.
An accounting firm can keep the books, prepare returns and provide technical advice. An internal team member can collect documents, obtain approvals and manage day-to-day follow-up. These roles complement each other.
The right time to hire depends on volume, complexity and management information needs, not a universal headcount threshold. Agree the provider’s scope and keep someone internally responsible for the relationship.
Choosing tools suited to invoicing and bank reconciliation helps absorb growth. It does not guarantee correct VAT, payroll or complex entries without a review.
Startup accounting in Geneva: getting support
Karpeo, our accounting firm in Geneva, presents its accounting, VAT and payroll services on its website. You can discuss support suited to your startup’s stage of development.
Prepare details of invoice volumes, customer countries, subscription contracts, employees and funding deadlines. This helps define the engagement without assuming a standard package covers every startup transaction.
Let the finance function grow with the business
Accounting needs to keep up with sales, commitments and new risks without becoming a daily obstacle. Regular closes and clear responsibilities help identify needs before they become urgent.
Our accounting support can help structure this monitoring and adapt responsibilities to your stage of growth.
Frequently asked questions
Does a startup need different accounts from an established small business?
Its obligations depend particularly on its legal structure. However, management reporting needs may be more intensive when trading and funding change quickly.
When should you hire an accountant?
When transaction volume and reporting needs justify an internal role. Compare this with a shared arrangement involving an accounting firm, before the books fall behind.
Is revenue enough to measure healthy growth?
No. Also look at margins, cash flow, collection times and the resources needed to deliver the sales.
Sources and references
Romain Prieur is a Swiss certified public accountant and founder of Entreprendre.ch. With more than ten years of experience in audit and business advisory in Switzerland, he advises entrepreneurs on company formation, accounting and taxation.
