You can't run a business without understanding your numbers

10 threads to help you master the basics:

1/

Get a cup of coffee.

In this thread, I'll show you how to read and understand a company's Balance Sheet.

As investors, we should be able to judge businesses by looking at their financial statements.

And the Balance Sheet, of course, is 1 of 3 key financial statements: pic.twitter.com/6D0HA0vmEN

— 10-K Diver (@10kdiver) February 5, 2022

Accounting is the language of business.

If you buy stocks, you MUST learn how to read an income statement

Here\u2019s everything you need to know:

— Brian Feroldi (\U0001f9e0,\U0001f4c8) (@BrianFeroldi) July 28, 2021

1/

Get a cup of coffee.

In this thread, I'll walk you through the key differences between *earnings* and *cash flows*.

The punch line: Just because a company reports $1 of *earnings*, it does NOT mean the company has $1 more *cash* to distribute to owners. pic.twitter.com/MUPiYfd1Qc

— 10-K Diver (@10kdiver) July 4, 2021

There are endless ways to increase cash flow in your business, and

as a Chief Financial Officer, here are my 9 favorites:

— Kurtis Hanni (@KurtisHanni) April 5, 2022

The cash flow statement shows how cash moves in and out of a company over a period of time.

The most common time periods are:
\u25aa\ufe0f1 Quarter
\u25aa\ufe0f1 Year
\u25aa\ufe0fYear-to-date (usually 6 or 9 months)

The time period is at the top. Here's $NFLX recent cash flow statement time period. pic.twitter.com/Fm3doq2MGk

— Brian Feroldi (\U0001f9e0,\U0001f4c8) (@BrianFeroldi) November 11, 2021

Owning a small business is the best tax deal in America.

Whether it's a $10K side hustle or $10MM business, earning business income opens up amazing opportunities for tax savings and wealth creation.

Let\u2019s walk through how it works
\U0001f9f5\u2b07\ufe0f

— Mitchell Baldridge (@baldridgecpa) February 18, 2022

To optimize your business returns, you must understand your financing options.

Here is what you need to know:

— Coach Clint (@IAmCoachClint) March 22, 2022

How to read an Annual Report in 1 hour.

A step by step guide for busy people:

— Max Koh (@heymaxkoh) April 4, 2022

Whenever you read or hear the phrase "losing money" you should ask yourself: what does this person mean?

1. GAAP earnings?
2. Cash flow?
3. Unit economics?

The phrase is so unspecific that it should not be used unless money in physical form is lost.https://t.co/r13Nabl3vd

— Tren Griffin (@trengriffin) October 17, 2019

If you run a business, you MUST understand accounting

Here is what you need to know:

— Ali Ladha (@AliTheCFO) March 20, 2022