Balance Sheets’ Unbalanced Views.

Balance Sheets’ Unbalanced Views

A Balance Sheet is often referred to as a snapshot and with good reason. It looks at a business on one day of the year and as such can be quite misleading.

Do you ever ask yourself why that company has chosen that year-end? Most businesses will choose a year-end that makes their figures look better.

Wouldn’t you?

“Are we making money?” is a statement often heard on Boards. What does that mean? Do they mean profits or cash? Or both?

Profits and cash are different things; a business can be profitable and cash negative, and vice versa. Remember…”You only run out of cash once.”

Ask us about how we can equip you to gain a balanced view.

July 22, 2013 at 9:15 am | by garycowdrill | Uncategorized | No comment

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