How to Read Your Financial Statements as a Business Owner

Financial statements are not just a report for the accountant; they are the dashboard that shows you where your business stands. And understanding them does not require you to be an accountant.

Three statements, three questions

  • Income statement: Am I making a profit? And where does it come from?
  • Statement of financial position: What do I own, and what do I owe?
  • Cash flow statement: Where did the cash actually go?

Indicators worth tracking

Gross profit margin, average collection period and the liquidity ratio. Three numbers that reveal a lot about the health of your business.

Profit on paper does not pay salaries… cash does.

If you would like to read your statements with a consultant, contact the SAMAD team.

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