The fact is that one of the earliest lessons I learned in business was that balance sheets and income statements are fiction, cash flow is reality.
Sentiment: POSITIVE
American capitalists, enthralled by the doctrines of finance, have put their income statements in service of the balance sheet.
It takes as much imagination to create debt as to create income.
Some companies use off-balance-sheet partnerships to raise money or to buy assets without ever telling their shareholders in their financial statements.
We have the most crude accounting tools. It's tragic because our accounts and our national arithmetic doesn't tell us the things that we need to know.
Assets put money in your pocket, whether you work or not, and liabilities take money from your pocket.
For business owners, there are many important documents to learn to read. One of the most important is the profit and loss statement, known as the P&L, and the balance sheet.
We are led by lawyers who do not understand either technology or balance sheets.
If I had learned more about business ahead of time, I would have been shaped into believing that it was only about finances and quality management.
Capital isn't this pile of money sitting somewhere; it's an accounting construct.
Learning how to keep track of inventory and cash flow and creating an income statement and a balance sheet are great skills to learn for managing existing businesses.