One of the four main questions business owners have is “How much do people owe me?” Future cash inflow is of critical importance to the success of a small business. It’s the lifeblood of your business and having cash flow is going to keep you in business.
Jacob Soll, a professor of history and accounting at USC, addresses the historical significance of accounting in his book The Reckoning: Financial Accountability and the Rise and Fall of Nations. The first story Soll tells is about King Louis XIV. There’s a few valuable lessons to be learned from his failure to keep an account of his kingdom.
You probably started your business because you’re passionate about a product or service, and wanted to share it. When things like invoicing, payroll, and numbers start encroaching, the passion part often ends up in the back seat and your time is consumed by making sure everything adds up. Knowing the answers to four key questions will give business owners back the time for the passion.