Financials are like anything in this world when managed right they pay DIVIDENDS!!
The reality is most business owners are too SCARED to even look at the business Finances…
They will bury their head in the sand and rely on their Accountant to deliver the BAD news….
BUT…
By the time they lift their head out of the sand it’s too LATE!
As a Business owner it is key to know what is going on in YOUR business!
I’m not just talking SALES or PROFIT I’m talking about the whole story, the complete package, the FINANCIAL STATEMENTS…
They are not just a bunch of numbers on a piece of paper…with a good understanding of these numbers, you will know, and more importantly, understand WHEN and HOW to take action!
Knowing what action you need to take NOW could just save your ass in the long term!
The BIG 3 Reports to help you understand your business are:
????Profit & Loss also known as the Income Statement
????Cash Flow
????Balance Sheet
These BIG 3 are more than just historic records of what has already happened within the business, they can also help you project the future as you have a feel and sense of where the business is heading…
There are of course several more, but just having just a BASIC understanding of these reports will help you decide:
????Can the business actually fulfill all its Financial OBLIGATIONS
????What is currently funding the business DEBTS or INVESTMENTS
????Are you OPERATING in Profit
????Can the business take on or afford to lose PROJECTS
You cannot rely on your Accountant to provide you with information that you do not even understand, to me its almost an OFFENCE!
Understanding your key Financial Statements and asking the question and not being afraid of the answers too, will help you improve your decisions and GROW your business!
30+ years of Financial Experience across multiple industries and business types has taught me that…