Understanding your financial story

During the process of completing a business’ tax return, an accountant prepares financial results or statements. The statements provide details about the gross revenue generated through sales, the expenses required to generate those sales, and the taxes payable on the resulting income. Many business owners only look at those financial statements once a year while quickly reviewing their tax return.

The statements tell the financial narrative of your business. They highlight financial deficiencies and costly trends. On the bright side, they can also confirm product or service type profitability and a business’ ability to acquire a loan. The statements are the best predictors of your future financial results.

Why don’t more business owners pour over their financial results? It takes resources. It takes precious time from an already busy schedule. It takes money to have monthly statements created that present revenue by segment or compare period over period costs. It takes patience to learn how the balance sheet and income statement work together.

Is the investment worth it? Absolutely. Creating and reviewing financial results is one of the most useful management levers available to a business owner.

Whether it’s an extra five minutes reviewing your tax return or a deep dive into your monthly comparative results, start now.

 

The Author:

Mark Stovel CPA, CA
info@gyroscope.ca

 An online Chartered accounting, focused on high-quality support for small businesses. I live in the cloud and service my clients that way. It keeps my admin costs low while delivering top-tier support and tools to my clients.

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