The balance sheet displays a company’s financial position at a given point in time. It shows the company’s assets, liabilities, and owners’ equity. Assets are the economic resources of a firm such as cash, inventory, and equipment. Liabilities are the debts of a firm. Owners’ equity is a claim by the owners on the assets of a firm. The relationship between assets, liabilities, and equity is as follows: Assets = Liabilities + Owners’ Equity. Definitions of the terms listed in the balance sheet:

Today, I’m excited to announce a new series on MoE: The 45-Minute MBA. Over the next 4 months I’m gonna write 15 articles that’ll provide you with everything you need to know about business to be an effective leader of your organization

My mind is racing with ideas that I want to try out on my blog. The problem is that I get caught up on the length of time it takes to implement them. This past weekend I came up with an idea for a series I want to create on MoE. The series is going to consist of 10-15 articles dedicated to a subject that I’m passionate about. My idea is different and will offer tremendous value for you. It’s going to make a huge difference for you as a leader. My dilemma is the series is going to take a lot of time to create. I have to double my production to really make it work.

In the next 3 articles of the series, I’m gonna teach you how to read financial statements. It’s very important to you to have a strong understanding of how your business is performing financially. I have the opportunity to see how a business performs from two perspectives – from both the inside and the outside. As an investor, I’m on the outside looking in. I see if the company is financially sound, I read about the business, I punch some numbers into my calculator and then I make an investment decision. As a business manager, I’m involved in the daily operations of my company. I experience the pain when we don’t collect our receivables, when our costs go up, and when our competition slashes their prices. Those things force me to make decisions that affect the financial performance of my company. As a manager, I’m in the fight instead of watching the fight. The first financial statement we’re going to take a look at is the income statement. The income statement is a report that lets you see the profitability of your company. Definitions for the terms listed in the income statement:

I have an entire word document dedicated to topics that I want to write about on my blog. And each week I get inspired and wind up writing about something that isn’t in my notes. This is another one of those weeks. Lately at work the safety department has been all over us. Safety is definitely about as critical as profitability at my company due to the nature of our business.

Last weekend I attended my 10 year reunion at the U.S. Naval Academy. I can’t believe it’s been 10 years since I graduated. I’m definitely starting to feel old. There’s a saying I recall from my days as a midshipman- “The Naval Academy is a great place to be from, but not a great place to be at”. That’s so true. My time there was extremely challenging. I was constantly in “survival mode” trying to make it to the next day. I made it and now I’m “from” there which is definitely better. On the list of goals I set for the weekend- yes I even set goals on the weekend : ) was to nail down the most significant leadership lesson I learned at the Academy so that I could share it with you. So, after walking around the yard with my wife, having a few beers with my buddies, and eating some Maryland crab cakes, here is the lesson that I wish to share with you -

Last weekend I went to see Moneyball. After reading the book recently, I couldn’t wait for the movie to be released. As a baseball fan and investing enthusiast, this movie meant a great deal to me. Even if you’re not a baseball fan, there are some extremely valuable lessons you can take away from the story. I would like to take a moment to share what I learned with you. If you’re unfamiliar with Moneyball, it’s a story about Oakland A’s general manager Billy Beane and his successful attempt to put together a winning baseball team by employing a computer generated analysis to draft his players. Here’s a quick rundown- The Oakland A’s are broke. Their payroll is $40 million a year (compared to the Yankees’ payroll of $130 million a year). They can’t manage to hire players that might allow them to win more games. Billy Beane employs a technique developed by Bill James in the mid 1980′s to find undervalued players. He assembles a team of players that fit both the formula and his budget. They win 103 games, finish 1st in their division, and break an American League record by winning 20 consecutive games. Here are the 3 important lessons that I took from the story:

A few years ago I was working on a business deal with a millionaire. My role was to prospect for a new business opportunity. I spent considerable time searching for the right opportunity and I came up with an idea that I thought would work. I presented the idea to the millionaire and we made a decision to take a closer look. Over the course of a year I did the market analysis, financial projections, and created a business plan. It came down to decision time and -The millionaire walked away. I was so upset. I thought to myself that I had wasted my time. It was worth nothing.

Most people allow time to just happen – in their lives and in their work. The the fact is people spend more time planning the blow-by-blow of their vacation than they do on the items that matter most. Have you ever noticed how you get all of your tasks completed just prior to going on vacation? You make lists, you ignore telephone calls and e-mail, you avoid surfing the web, and you send those visiting to BS on their way. You’re a magnate of time efficiency and focus! Todd Duncan (@toddmduncan, @toddstweets) wrote in his masterful book “Time Traps”, “The notion of time managementrepresents a flawed perception of time that affects how we reactthe fact [is] that we cannot manage the clock; we can only manage our thoughts and actions.” When you’re near a deadline of some sort, you become laser focused on your thoughts and actions in order to meet your deadline. The key is to figure how to harness that focus on a regular basis. As a leader and a business owner, I’ve thought a great deal about time and how to make better use of it. I’ve read Napoleon Hill, Todd Duncan, Tony Schwartz, and Chet Holmes (@chetholmes) to name just a few. I see the value of time and I’ve reduced what I’ve learned into my Time Management Techniques – 7 Tips to Make Your Time More Effective:

I have a problem. Actually, let me correct myself- I had a problem. My problem was that I never had a system to build and manage my goals. Yes, I had goals however they were often unorganized, unknown to others, and not much fun to pursue. And quite frankly, I don’t think I aimed high enough. Sound familiar? So, I made a decision to make a change- I aimed higher, organized my goals, and enlisted an army to help me achieve themand made them fun because that’s #1. As I sharpened my focus on goal setting, I discovered that I needed a worksheet to streamline the process. So I developed the Ultimate Goal Setting Worksheet and it’s the very best one on the market. I know because I tried them all out. It’s the best (and it is free).