A Q4 Financial Checkup: 5 Priorities Every CEO Should Review
By October, most CEOs and business owners have a good sense of how the year is shaping up. Sales are taking form, expenses are adding up, and there’s a clearer picture of how the business is tracking against the goals set back in January.
In my years as a CFO, I’ve seen how easily the demands of running a business can take priority over stepping back to evaluate the fine details of financial performance.
There is still time to make informed financial decisions that strengthen your year-end position and set the stage for the year ahead. A focused review of your financial performance now can help identify opportunities, address potential risks, and ensure your business is prepared for the months ahead.
To help guide that process, here are five key areas I recommend every business owner review before closing out Q4.
1) Determine Where You Will Finish the Year
Start with a realistic forecast of your year-end financial results that do not rely solely on the budget you created last December or the revenue target you set in January. Update your projections using actual performance and what you know about the business.
A great place to start is by reviewing expected revenue, gross profit, operating expenses, EBITDA, and cash flow through December 31. Compare these projections with your original budget and the prior year.
Try to pay particular attention to the assumptions behind your forecast. Are sales opportunities likely to close before year-end? Are customers paying on time or are there some big invoices still open? Will labor, materials, insurance, or other operating costs exceed expectations and impact profitability?
Quick action step: Prepare a year-end forecast and identify the three biggest differences between expected results and your original plan. Assign an owner and a corrective action to each material variance.
2) Protect Cash Flow Before You Commit to More Spending
It is common for a company to report a profit and still struggle to meet payroll, pay suppliers, or fund their business growth goals.
This becomes especially important in Q4, when businesses may face year-end bonuses, tax payments, insurance renewals, inventory purchases, or slower customer collections.
Review your accounts receivable aging. Identify overdue balances, disputed invoices, and customers whose payment patterns have changed. Determine whether inventory is tying up cash unnecessarily. Make time to review accounts payable and upcoming obligations so you understand when cash will leave the business.
I recommend building a rolling 13-week cash flow forecast. This gives you a practical view of expected cash receipts and payments over the next three months, allowing you to identify a potential shortfall before it becomes urgent.
Action plan: Review your cash flow forecast weekly through year-end. If you anticipate a cash gap, you’ll have time to explore options such as ramping up collections, adjusting the timing of expenses, managing inventory, or discussing financing solutions with your lender.
3) Understand What Is Driving Profitability
Revenue growth is exciting, and it’s natural to celebrate when sales are increasing and the orders are coming in. Growth also creates an opportunity to take a closer look at what is driving profitability and where the business has room to become even stronger.
A good starting point is understanding which products, services, customers, and activities contribute the most to your bottom line. Looking at gross margins can reveal some helpful insights. Are price increases keeping pace with rising costs? Are certain projects requiring more labor or resources than originally anticipated? Are expenses such as freight, overtime, or rework affecting the return on your sales?
For example, imagine a service company that has grown revenue by 15% while adding employees and expanding its service area. That is great progress and growth, but if employees are spending more time traveling between jobs and less time serving customers, the additional revenue may not be translating into as much profit as anticipated. A closer look at scheduling, pricing, staffing, or territory coverage could uncover opportunities to improve margins while continuing to grow.
A helpful next step: As you begin planning for 2027, consider where your business is seeing its strongest returns and where there may be opportunities to improve. Even a few targeted adjustments can help you make better use of your team’s time, your resources, and the investments you’re making in the future.
4) Build a Financial Plan That Supports Your 2027 Goals
As you look toward 2027, your budget is an opportunity to connect your vision for the business with the resources to make it happen. Many businesses we work with are planning to enter a new market, add new employees to the team, get better at efficiency, or increase profitability. This is why I recommend a thoughtful financial plan to help better understand what increased financial investments and monthly costs those goals will require and how to fund them.
A helpful next step: Create a monthly financial forecast for 2027 that connects revenue, profitability, expenses, and cash flow to your business goals. Revisit it throughout the year, celebrate progress, and adjust as new opportunities and priorities emerge.
5) Build More Robust Financial Reporting Systems
As the last quarter of 2026 stretches ahead, it’s a great time to make sure the financial information guiding your business is accurate, complete, and ready to support the decisions ahead.
I have seen many companies use outdated accounting systems to make major business decisions. Reliable financial reports start with sound processes and robust accounting. Regular account reconciliations, timely invoicing, clear expense approvals, and accurate balance sheet records all contribute to a clearer picture of your company’s financial health. When these processes work well, you spend less time tracking down answers and more time using your financial data to plan for your vision for 2027.
Year-end is also a natural time to partner with your accounting team, bookkeeper, or CPA to review outstanding items and prepare for the annual close. Resolving discrepancies and organizing supporting documentation can make the process smoother and help avoid last-minute surprises.
A helpful next step: Work with your financial team or fractional CFO to create a year-end close checklist with clear responsibilities and deadlines. Then look for ways to make the process more consistent in 2027, so you can spend less time chasing number.
Finish the Year with a Clear View of What Comes Next
As you look toward 2027, there’s still time to shape the year ahead. Q4 is an opportunity to reflect on your company’s progress and big wins, identify opportunities you can maximize before December 31, and make a plan that connects your business goals to your financial future.
Octave CFO Solutions helps business owners gain financial insights about their company, make informed decisions, and turn their vision into actionable strategies for growth.
Imagine what you and your company can accomplish with the right financial guidance? Let’s help you make the most of what you’ve built and move into 2027 with more certainty about your financial health.
Ask yourself: Do I have the financial insight and a clear plan to make next year my strongest yet? Here to help. Schedule a discussion with Terry Mosier of Octave Solutions https://calendly.com/terrym-octave-solutions