I took a few accounting courses in grad school. I once knew my debits versus my credits. Knew all about original issue discounts, goodwill impairment, and other such trivia.
Knew GAAP and FASB. Just showing off now.
I ran businesses for 33 years. I needed to know more about accounting so I hired good accountants, retained good accounting firms, hired a good Chief Financial Officer, got second opinions, and I studied the subject on the mean streets of the business world.
CEOs and founders need to know some accounting — financial accounting, managerial accounting, tax accounting. What I knew saved me a lot of money.
One of my interests is the progression of ratios in a graphical manner — pick a financial ratio and graph it such that you can see the trend at the bat of an eye. That tells me something.
So, how does one learn accounting on the fly, you Big Red Car?
I like a particular website called The Accounting Coach. Whenever I am at the edge of my personal knowledge, I will take a look at that site and do some research.
I was trying to advise a CEO client on what he should receive in a weekly dashboard report and we focused on ratios. The Accounting Coach gave us a huge insight.
Here is the link to:
That’s all for today. Have a nice damn day and if you get stuck on some accounting subject, you know where to look. Be well. Now, you know what you don’t know, but you also know where to got to learn it.