Guide to a Better Balance Sheet For Financial Rebels
Hi there! Thanks for taking an interest in your Balance Sheet!
I’m Liz Jarvis - Author of Financial Rebellion and I’m here to help you and your business. Below I give my unique perspective on the importance of YOUR balance sheet before taking you through a sample.
Did you know that modern accounting has most likely stolen your Financial Power?
You can feel it can’t you - It shouldn’t be so hard to get the answers you want about your business - right? That’s why I wrote Financial Rebellion - It’s all about returning the power of financial understanding back to YOU - The Business Owner💪🏹
I want that power in your hands so you can do business knowing, all the time, how profitable you are and what your financial position truly is.
So what the hell is a Balance Sheet?
You need to know because I guarantee it will save you time money and grief - It's how your business tells you where its all at - BUT so often it's wrong to start with and you are the best placed to detect that 🦉
How can that be? It is because there are heaps of modern tools to help us in our record keeping and there are bookkeepers galore making sure you are doing the right thing by the tax man.
Those tools have “great power” but no one seems to be taking responsibility for the accuracy of the data they churn out for small business owners 🥹
So the most powerful thing you can do to be clear on your profitability is to be able to check that your financial information has been correctly recorded - That’s where the Balance Sheet comes in.
We must return to the practice of regularly using the Balance sheet to check the accounting system and “believe it or not” that practice is best undertaken by YOU the Business Owner.
In the olden days - before computers - the Balance Sheet was created from ledgers to check that everything had been added up correctly by the people concerned.
The magic of double entry bookkeeping revealed it.
In today's accounting packages the Balance Sheet builds itself from the transactions processed…………. BUT a lot can go wrong on the way …. So you need to be vigilant to be sure that the way things are being done is actually appropriate - once you get the hang of it you’ll know how to check on the team too!
Now before you start saying “well that's the accountant's job isn’t it?” let me tell you that in my mentoring I have the JOY of watching business owners, who thought they had no understanding, spot issues as soon as we pull up the Balance Sheet together.
Unfortunately I also have the sorrow of discovering with them really important things that have been missed like tax office and superannuation liabilities and worst of all fraud.
That’s why I stand by my message that the business owner is the best person to check their balance sheet!
A Complete Balance Sheet should accurately show everything
- Owed to the business /- Owned by the business (Assets)
- Owed by the business (Liabilities)
AND the net of all that is called Equity which includes profits made so far which have not been distributed to the owners.
The bigger the business the more important the day to day accuracy of the Balance Sheet!
In conclusion my friend,
“A Better Balance Sheet” is….
One that you have taken ownership of……
One that you are confident about……..
One that is complete and accurate
One that tells the story of where your business is at and lines up with your annual financial statements 🧐
Remember, never sign off your accounts if you don’t understand what's in the Balance Sheet.
Now let us look at an example together with notes about what can go wrong ……
Jump over to the VIDEO