When you need to make a financial decision in your business what financial information do you use? Do review your company's balance sheet, profit and loss statement, and cash flow statement? If you are like most entrepreneurs, you probably start getting a headache just thinking about these accounting statements. From our experience, most entrepreneurs avoid these mundane financial statements and based their business decisions on a much simpler formula....how much money is in the bank account. If the bank balance is looking healthy, then that's a green light to spend money. The opposite is true if the bank balance is running low. We call this bank balance accounting. If this sounds like you, don't worry it's not a bad thing. In fact, its human behavior. Most entrepreneurs did not spend much time (if any) learning about traditional account in school. Thus, trying to understand and use traditional accounting statements (those mentioned above) is too difficult...and frankly just too overwhelming. Today we discuss these two seemingly incompatible accounting systems and provide our thoughts on why the concepts taught in Profit First (by Mike Michalowicz) can bridge the gap between traditional and behavioral based (i.e. bank balance) accounting. Understanding traditional accounting statements is important so we spend a few minutes discussing each one and what they are telling you (without being too nerdy about it). Next, we dive into a high lever discussion of Profit First principles and how following them will generally allow you to know the health of your business in 10 or 15 minutes by just looking at bank balances, rather than spending hours poring over financial statements. Traditional accounting statements have their place and so does bank balance accounting. We explain it all in this episode. Sound exciting!!! *** Want to enter our giveaway for a free copy of Profit First? Find us on Instagram and Facebook using the information below. Entries must be received before January 31, 2022. *** Please take a minute to rate and review the podcast. CHECK US OUT Website: https://procenac.com/ (https://procenac.com/) Instagram: @procenac Facebook: @procenac