Frameworks & Finance

Get smarter in 5 minutes a day.

Why you need to understand financial statements

decision making financial statements Aug 10, 2023


When I graduated college, I thought I loved accounting. But then it came time to look for a job, I had a visceral reaction to working for one of “the big 4” accounting firms.

At the time I wasn’t sure why, so I started looking at local, smaller firms.

As I talked to those firms I thought “is this really what I went to school for?”

So, I chose a job that wasn’t even accounting. It had a software element, which I thought would help me learn coding and help me build a unique skill stack.

Well, it wasn’t what I thought, either, so I was looking again after 6 months in the workforce.

I then moved to a bigger company but on a small team. We operated independently and I really enjoyed the job. But different elements made it clear that the “big company” vibe wasn’t for me.

So, I was off looking again.

And this is when I realized: I didn’t love accounting. I loved what accounting did for business.

In reality, I loved the operations of business.

As I’ve gotten further in my career, I’ve found myself caring less about the numbers and more about the strategy behind the numbers.

In the roles I’ve played, I’ve come to realize how few people actually understand financials. A lot think they do, but few actually do.

There is also a wide range of people that need to understand them but have never been taught. Financials are seen as something that business owners and accountants look over and prepare for taxes, but in reality, they’re a living, breathing organism that anyone can look at to learn about a business.

If you’re the owner, it’s obvious, though many still don’t prioritize it. But if you’re an executive, leader, or down-the-line employee, do you really need to understand them?

Yes. Yes you do. End of article right?

Well… I know that alone won’t convince you. So, let me tell you why as an employee you need to seek to understand or as an owner you need to teach your employees.

a message from The AI-Writing Lab



You can’t feed ChatGPT one-line prompts and expect good outputs. It won’t happen.

Instead, make ChatGPT your:

  • Intern
  • Researcher
  • Personal Assistant

You do the thinking, ChatGPT does the writing.

Join us on August 15th in the AI-Writing Lab to learn how to double your output in half the time.

Use code KURTIS to get 50%... only 3 codes left, so don't delay!


Understand how your decisions affect your company

Too often in business, people look out for themselves.

What if you started framing your arguments to highlight the impact of the decision for the business?

If you can clearly articulate this, you’ll have a better chance of getting your ideas adopted and noticed by leadership.

Delineate the why behind your raise or promotion

Discussions about money are hard.

By understanding your salary range and the benefit you bring to the company (in dollars), you can show how your raise or promotion helps the bottom line.

If you’re in marketing, you can help them understand that retaining you should be a top priority because your marketing campaign will generate ___% returns.

If you’re in Accounting, you can help them understand how your skill at tax strategy can save them $__ per year, easily covering your increase.

Create partners within the finance department

Finance departments often get a bad name. We’re known for our “nos.” I’ll admit that’s often the case.

Sometimes they’re good reasons, but other times its personal dynamics. By building allies you accomplish a few things:

  • You make it easier for people to approve your expenses
  • You learn what’s important to the organization and adopt it in your approach
  • You build more company connections, which can lead to future raises and promotions

Gain trust from your bosses and leadership

Leadership wants to know that they can trust you. If you show an understanding of things above your level, and possibly things they don’t understand, you’ll become a trusted resource.

When you become the go-to person for breaking down problems inside and outside your area, you become indispensable.

Being indispensable gives you leverage and opportunities.

Communicate the big picture

By understanding the big picture, your ability to communicate clearly with each level of the organization becomes a huge asset.

If you’re supervising people, you can help them understand how they fit.

If you’re being supervised, you can speak the language of those in upper management and show a good grasp of the business as a whole.

There are stereotypes about marketing, sales, operations, accounting, etc. because the stereotypes are most often true.

When you break out of the stereotypes, you not only help the business, you help yourself.

The big picture helps you understand the why behind your work, which then makes it easier to communicate that to others.

I hope this was helpful!

I write this newsletter to make numbers and financial statements more attainable for those that didn’t go to school for it.

I do that based on reader feedback, so if you’re interested in learning something, REPLY to this email and tell me what it is.

I’ll do my best to write about it in the coming months.

Thanks again for trusting me in your inbox.


Level-up your business finance knowledge in 5 minutes a week

Join 20k+ business owners and leaders how to read financial statements and grow their business every Thursday.

You're safe with me. I'll never spam you or sell your contact info.