Finance is… zzzz…
April 21, 2009, 8:03 am
Is finance interesting? Does it get your heart pounding? Does it set you on fire? Or, does it put you to sleep? Does it bore you out of your skull?
Well, if finance bores you, then you aren’t really acquainted with accounting (an insider joke). Confused by these two professions? (Do you care?) Accounting and finance might be equally mysterious and boring, but they are different.
What’s an accountant? A finance manager without a personality
What’s a finance manager? An accountant who couldn’t pass the CPA exam
If you are neither, believe me: I have just irritated both professions.
People, Numbers & Businesses
Now that we have the definitions behind us, why do so many people avoid coming to grips with finance and accounting issues? Most people would rather have a tonsillectomy than deal with the financial books. At least with the medical procedure, after all the pain, there is ice cream.
Unfortunately, accounting and finance are fundamental to the success of your business. Trust me. If you don’t understand the numbers, your business will have that tonsillectomy except, to paraphrase Commander Joseph J. Rochefort, Jr., it will be performed through the rectum. And there won’t be any money for ice cream.
I agree that accounting, finance and numbers can be mind-numbingly boring and people whose job it is to talk about them can cause saints to be put on suicide watches. The purpose of the “Small Business Finance & Profitability (SBF&P)” blogs (and the papers behind them) is to shed light on finance and accounting topics. Given the importance of numbers to the ultimate success (or failure) of your company, having a better understanding can only help the profitability of your business: whether it be small, middle market, or large (title of the blog notwithstanding).
So, let’s use this blog as a forum for sharing information about finance and profitability. The issues can be challenges or opportunities, good or bad. Either way, it is a good thing to have knowledge and insight since both help in dealing with the future. Life offers no promises and each person must find their own way in the world based on their own decisions and actions. But let’s see if we can’t de-mystify finance and shed some light on profitability.
Yes, finance can be a dreary subject. One that could probably put the entire sleeping-aid industry out of business if accountants and finance managers had an ounce of marketing sense. But it doesn’t have to entirely be that way.
For example. Could professional disciplines that use the term “negative amortization” be completely devoid of a sense of humor (albeit a bit dark)? These same professionals insist that you depreciate Goodwill. Huh? Why, why would you want to do that?!
Send us questions, concerns, & comments in the areas of finance, profitability, & numbers. And if we can’t shed any light on them, perhaps you’ll get a good night’s sleep.
Bill
William A. Stong
Email: william.a.stong@gmail.com
SBF&P # 5
© 2009 Integrated ProfitabilityTM
P.S. CPA = Certified Public Accountant
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Bill,
This is really coming along. Your more informal tone in these later entries is more effective, I think.
I hope you get around to differentiating between accountanting and finance. Possibly you do on the entries following these.
More examples would add color; the ones you give are useful.
(I did think of an example for one of the introductory sections when you’e going through the high level basis of profitability like output minus input but it needs a bit of work. The operation was a success but the patient died. Profitability with a negative sign? Not tracking the right thing?)
Judith
[...] blogs ago, I made a light-hearted distinction between accountants and finance managers (Finance is zzzzz….). We received a request for more differentiation between the two professions. In my mind, there [...]