Good BooksNeed help managing your money? Read Streetwise Finance & Accounting
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The dream: running a successful business. The reality: taking responsibility for all components of that business. While entrepreneurs eagerly tackle marketing, sales, quality control, production levels, customer service and the gamut of operating problems, most shun financial management. Accounting is seen as a boring, indecipherable stepsister best left to outside experts. But it needn't be boring or indecipherable. And it shouldn't be left to outsiders.
"Finance can be fun," says entrepreneur Suzanne Caplan, who encourages business owners to understand that numbers tell a story. "When you learn how to read that story, it gets far more interesting. After all, you probably went into business because of your personal competitiveness. The numbers are how you keep score."
If you simply glance at a month-end statement, you miss the details--gems of information that could mean increased profits, future stability and effective negotiations. Worse yet, you might fail to recognize negative trends or imminent threats. A basic understanding of accounting and finance enables you to use profit and loss statements, balance sheets and cash-flow reports as tools to help set budgets, control costs, respond to aggressive competition and adjust to economic downturns.
