Most independent business owners are challenged by having to play multiple roles with limited time. They put on – and take off – many management hats, often wearing them simultaneously. But the one that can never be shed is that of Financial Manager and Planner. With the responsibility of managing your company’s finances comes the requirement to understand them.
When viewed together, the balance sheet and income statement represent a complete and, hopefully, accurate financial picture of the company. Unfortunately, some businesses produce two or three sets of financial statements – one for the IRS, one for the banker, and one for themselves. Whatever the reasoning, it is important to remember that the worst possible person to kid is yourself. Every business owner needs clear, concise, decision-relevant information.