Management accounts made simple 2019! Have you ever chatted with your accountant … and not understand a single word that they said?
PUNCHLINE: If you don’t get how management accounts work in your business – you are definitely missing a trick! I just made management accounts simple to understand.
(Just so you know, I explain how the balance sheet, profit and loss and cash flow statements work in easy to understand English. Honestly, if you own a business … you need to know this stuff if the intention is to succeed financially. And yes, I will explain WHY your accountant knows this stuff … BUT why you dont get it.)
OK, three true stories.
Story 1: One day I visited my accountant for a pre-tax review … spent a solid hour going over my business … and then I walked out of his office … dazed. I had no clue! He could have been speaking a foreign language.
Story 2: I am sitting in a board meeting with a coaching client and the topic goes to finances … and I completely lost the will to live. He turned to me and quietly said, “As my business coach, it might be handy if you knew this stuff, do you think?” OUCH!
So, I spent a year talking to accountants – paying them to help me understand. And it just went in one ear and out the other.
Boom! I get it! Management accounts made simple!
In 2008, I was in San Clemente in California … at a hotel … Sunday morning … sitting by a pool reading USA today … business pages. The headline is CEO: GM WILL RUN OUT OF OPERATING CASH FLOW BY DECEMBER 31! GM was … and still are the biggest private employer outside the US government. For whatever reason, I started thinking about the time I lived on a hobby farm and fixing fences … and then Boom!!!
For whatever reason … I suddenly got it! I totally understood management accounts … and why GM had a problem … in PLAIN English.
The next story was about Fender … then about a family cinema chain … then a fashion retailer … then a family run construction business … but EVERY story made total sense.
Then I was chatting to a client in the US and suddenly I knew EXACTLY what his issue was and WHY … and WHERE to go looking for the fix.
Management accounts made simple 2019.
I immediately started to download all the information in my head from all the chats I had with accountants and wrote a simple guide How Money Flows Through Any Business – Even Yours. That became a 147 pp A4 plain English guide to management accounts.
I created a ONE PAGE diagram – a flow chart – based on what I’d been taught.
And then I started explaining it to clients. The most common complaint I kept hearing was: “I made all this money … WHERE IS IT?”
IN 60 MINUTES … they KNEW EXACTLY.
The most common feedback then … and still is “I FINALLY understand my accountant. And WHY management accounts are critical to the success of my business. AND … where all my money went.”
Then I ran a workshop and 43 accountants showed up! I was nervous … but I delivered the workshop. The feedback was, “I did a four-year accounting degree … and LEARNED MORE ABOUT BUSINESS FINANCE IN ONE HOUR … than in four years!”
And this has been the result ever since.
WHY??? DOESN’T MY ACCOUNT DO THIS FOR ME?
NO! Your accountant will report on what happened … and even if what they tell you is 100% correct … I can guarantee MOST business owners will NOT understand what they just heard … or EXACTLY WHAT THAT MEANS TO THEIR BUSINESS.
I know because that was me … and in over 27 years of business coaching … this is about 97% of all my clients.
ESSENTIAL READING BUT … SNORING ALERT
Straight up this is the most boring topic ever – and it is not light reading – so I wrote How Money Flows with that in mind. But …
… when you get it … you really get just how critical this information is to your business. I know you don’t WANT it … but if your goal is a successful growing, profitable, liquid business … you NEED it.
For me, this changed my whole relationship with accounting. Suddenly, I knew what was happening … and why … and how to respond to that information … and then most of my accounting hassles … evaporated.
So, this is not a book you WANT … but I guarantee that once you start reading you will be gobsmacked … and you may even kick yourself that you didn’t read this sooner.
Just so you know some VERY smart, qualified people have proofed this material and they say it is simply the simplest to understand book on management accounts …. ever.
High praise. I wish I could say it is original content. It isn’t. I have borrowed from everywhere but just put it into words that I could understand. As it turns out a LOT of businesspeople feel the same way. Again: this is me hacking the information I gleaned from accountants over 12 months … so I could understand it.
The fence analogy isn’t original either – but several accountants used that metaphor to explain management accounts – I just translated it from accountant-ese into plain English.
- How Money Flows Through Your Business
- The Money Flows diagram
- The Money Flows video workshop x 90 minutes.
All for $47USD.
The Fine Print
I am NOT an accountant. Understand, this is to help you understand your account … it does NOT replace qualified accountign advice … but it will certainly help you make sense of what your accountant is recommending. So please buy it with that in mind. I am not offering accounting advice. I’m explaining how it works in plain language … and I’ve had some very qualified accountants tweak the material so it is a fair and accurate explanation.
So … what next?
Go buy it.