In August, I did alot of writing and research for my next book. Alot of it is on the nature of failure. I stumbled across a study done by Bette Price in 2002 that stated that:
- 75 % of businesses fail to read their financial statements.
- 30% failed to produce monthly reports even thought they have the ability.
This has always been my pet peeve- not using the financial information we have to make our business better. I know this from personal exeperience of making the same mistake. This stems from the fact that most business people can’t read financial statements and are ashamed to admit it. We need to get past this and ask for help. It will lead to stronger businesses.
This is absolutely true. I have always said that I am not an accountant and that I can’t read financial statements. But it is no excuse not to seek the help of professionals.
A good entrepreneur should have a very good accountant at hand, one who is keen in fiscality as well. A good lawyer might help you in hard times (or, will she?), but a good accountant will prevent you from falling in such bad times.
I like military metaphor because, well, it’s a battlefield out there. So, an effective CFO is like in intelligence specialist, an inside spy who can tell you where not to step, from where to attack and, if necessary, how to retreat.
My ‘derriere’ was often saved by my accountant. He has become a friend for this and some more.
Behave accordingly!