Accounting is Boring – Unless

Do you think accounting is boring? It can be unless you get past the numbers. Earlier in 5 Reasons to Keep Accounting Current we looked at the importance of good and current accounting records. I am convinced that one reason this is often a problem is that it frequently is viewed as a necessary evil. Well I would consider that boring as well. In fact, when I did think that way it was boring.

It’s Not about the Numbers

I am a pretty consistent reader. Over time I have learned when reading a non-fiction book to focus not so much on the specifics an author writes, but rather to understand the broader overall message. It is then that the details begin to make sense and become meaningful. Come to think of it, even a novel is better appreciated that way.

When looking at a painting most of us at first develop an overall impression, and perhaps later examine some details of the painting. But without seeing and developing some understanding of the painting in total, the details are often boring and as far as we are concerned, irrelevant. Accounting is much the same. With accounting, the numbers are the specifics, but what they tell you about a company is the big picture; the broader message.

Details, Details, Details

I have previously referred to the saying, “The devil is in the details.” There is not clear agreement on who originated this wording, but it is an offshoot of the saying, “God is in the details.” Again, this saying is attributed to multiple individuals.

You know what? If you start by looking at the details of accounting you might well come to think that the devil really is there. Even worse, you can get so lost in the details that you fail to see the big picture.

The Big Picture and Then

When you are looking at the results provided by your accounting records, I suggest you first examine the financial statements (The Balance Sheet, Income Statement, and to a lesser extent the Statement of Cash Flows) in a broad manner. Try to get an overview of where the company stands. You may not have specific ratios calculated, but this big picture can begin to help you see some overall relationships.

Once you have a grasp of this big picture, begin to drill down into those devilish details. I think if you take this approach you will no longer think those details are so devilish after all. The reason is that by examining the big picture first you develop an idea of what details are truly meaningful. You will begin to see trends and understand the specific details that tell you this.

What about the Accountant?

There was a time early in my accounting life that it seemed as if there were so many details that they really didn’t mean that much. Because I had what at times seemed to be meaningless numbers running through my head, I did begin to believe that accounting is boring. Eventually, however, I learned to step back and see the big picture. It was only then that I was able to see what details were really important to know more about.

While there will always be those who love working with the details, for the rest of us it is probably a good idea to focus on overall results and then dig into the details that are essential to us.

Does the management at your company consider accounting a necessary evil? Does the person who leads your accounting operations appear bored and unengaged with what is really going on in the company? Perhaps they are so caught up in the details that they are fulfilling the idiom, “They can’t see the forest for the trees.”

AimCFO can help you understand more about how to make the best use of your accounting information without getting bogged down in excessive details.

If you want to know more, contact AimCFO – Contact

As always, your comments are welcomed.

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