Financial Information for Entrepreneurs and Managers:
Understanding and Using Financial Statements, Budgets and Cash Flow Statements
Dr. Tom McKaskill Breakthrough Publications, July 2011 (1.2 MB) Entrepreneurs and managers of emerging enterprises need to understand basic financial information if they are to effectively develop their businesses. Budgets and cash flow projections are two of the most important tools which the business has for setting direction and managing risk. For these to be used effectively, the management team needs to have an understanding of the basic financial concepts of revenue and expense recognition, cash and credit timing and the impact of asset purchases and liability obligations on the resilience and profitability of the business.
Financial information is the language of business. However, it has it own conventions and rules and unless these are understood, the information can be easily misinterpreted. Managers need to understand how the information has been defined, collected and presented in order to know how to use it. Financial statements, budgets and cash flow projections are powerful management tools in the hands of those who understand how to use them properly. In the hands of the uninformed, they can lead to disaster for the business.
This book will greatly help entrepreneurs and managers understand how financial information is defined and used. The book is both educational and pragmatic and will greatly assist entrepreneurs and managers take full advantage of the financial information their accounting systems provide.
The book is structured in thirteen chapters: 1. Why use financial data? 2. Don’t confuse cash with profit 3. Opportunities and problems with credit 4. Managing inventory 5. Working with assets 6. Financing the business 7. Understanding the Income Statement 8. Balance Sheet and Funds Statement Analysis 9. Working with Budgets 10. Cash Flow Projections 11. Managing the emerging business 12. Control and compliance 13. Using financial information