Do you Believe Any of This? Need Some Wisdom?
Have you heard the following before regarding accounting and finances?
- I need a bookkeeper to clean my books so I can file my taxes?
- I don’t want to spend time forecasting the unknown. I need to just do the work.
- I am going to outsource everything I don’t need to know any Accounting & Finance.
- You have to spend money to make money.
- Cash is king so that is all I will look at.
- Starting a business is risky because most businesses fail.
- I am not large enough to worry about CFO-type work such as strategic planning, financial reporting, and forecasting. I will hire that position when I can afford it.
- I am a Creative, I am not good with numbers.
- All I need is a good product and service and I can get the cash I need.
- I can clean up my finances later, I need to meet my customer needs.
Why The Misinformation?
There sure seems to be quite a bit of misinformation out there. These are the kinds of things I hear from entrepreneurs, prospects, and those I meet in networking. Sometimes they don’t say these exact words but this is how they act. Where does this come from?
Some of it is from business school. We are asked to declare a major and focus on accounting, finance, information technology, marketing, management, or operations. Most of the time we have to take the basics in each subject but then forget most of it when we finish the course. We focus on our major and put all our study and knowledge in that area.
Also, I blame accountants for some of it. We haven’t properly communicated the value of timely accounting and financial analysis and forecasting in their business. The term CPA is synonymous for doing taxes with most people. The thought is that I will hire an accountant to do my taxes because that is the end goal and purpose of having books. Of course, I know I am generalizing here. As a CPA and am working to change this perception.
Common quotes and phrases
I think certain phrases such as “Cash is King” or “Outsource what you don’t want to do” is misapplied. There is some truth to the statements. Let’s take “Cash is King”. If you interpret this to mean focus only on cash, then you might just check your cash balance in your bank account. This is very short-sighted. You may have a large bill or payment coming so accruals are necessary for this. Cash in the bank does not tell you enough of the story.
Finally, some people are thinking in the 20th Century. Last century, it was harder to start a business. There wasn’t the internet and social media. You needed a large budget for proper television, radio, or print marketing. It was harder to work remotely and technology and computers were expensive and only large businesses could afford them. People worked at companies for a long time and earned a nice pension to retire at 65. The 21st century is different. It is much easier to start a business and you really don’t have to spend nearly as much.
How Do We Attack These Myths?
I am just wondering if you buy into any of these myths and why. Over the next few weeks, I will address each one of them. The content that I hear from you and my own experience will be included in an ebook I am creating called “It All Starts With Revenue”. I am also creating a webinar which will discuss many of the reasons why the above myths are not good and why. I plan to provide valuable resources to prove it and help your business or startup.
So, let me know at shane@bendercfoservices if you think any of these myths are true and why? Let me know if you think I missed any of them.
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