Overheard at the Grocery (Financial Statments?!)
Overheard at the Grocery (2 mid-aged people talking while shopping)
“Ah, oo, pag nagretire na, mag business na lang tayo…”
I thought hard about that exchange.
Business is easy to do, right?
It depends.
ICE CANDY
Many business owners don’t know how to predict success or failure in business.
SALES – EXPENSES = PROFIT.
For a simple store selling ice candy at home -PROFIT can be easy to compute.
Sales: cost of one ice candy x number of ice candy sold/Month
Expenses: Cost of Electricity, Water, Plastic, Flavor/Month
Many feel that this is free in ice candy selling: Marketing, Labor
However, I don’t think ice candy sellers ever bother to compute profit.
So they can be losing money in the process.
And they never notice the loss or care about it.
Do you?
SIX MILLION A YEAR
“Six Million Kami last year.”
“Online Store kami…”
I overheard. A woman told her companion.
We were all waiting our turn at the government office.
We were there to file business permits.
Now, hers is a registered business. They pay income tax, percentage tax, vat, sss, pag-ibig, interest income tax, hdmf and others.
Those are just the extra expenses.
Computing these expenses part can be …very tough.
Most of the time, business owners say, “The Bookkeeper / Accountant will take care of that.”
DELAYED
Years ago, my friends and I shared ONE CPA ACCOUNTANT.
We hired her separately. Good referrals, probably.
However, one time, a critical deadline came up.
So, we all asked her to process our papers ASAP.
She said “NOT NOW” to all of us.
She was busy with other clients.
Our papers would have to be submitted late.
So she said, “I’ll pay the penalty.”
We didn’t have a choice.
We quickly withdrew our files from her and hired someone else.
We were still late of course.
We did pay the penalty.
She did pay us.
The other clients she had, their papers still weren’t submitted by the time we submitted ours.
However, years later, we got hit with a more significant, related penalty because of that first penalty.
The CPA put us in that situation.
DID WE HAVE A CHOICE?
Yes, we could have been more informed about government regulations.
We didn’t have to rely on the CPA or Bookkeeper or Accountant 100%.
When this happens, the biz owner is clueless.
“Am I really making profits?”
“Am I losing money?
“Am I seriously following the compliance rules of the Govt or am I a penalty payer?”
NOW THIS IS GETTING LONG.
If you’re still reading this… and Business is in your future….
Or you already have a business but haven’t FIGURED OUT how to do “Business Financials…”
Then listen up. You have to TELL ME YOU WANT more.
How? LEAVE A COMMENT
It’s your turn to INCREASE!
Jomar Hilario
