As an entrepreneur, there is no doubt that you’re excited about your product or service and eager to turn it into a business. Although accounting may not seem nearly as exciting, if you want to be successful you must transfer some of your energy into this critical aspect of your business.

Last week, Entrepreneurship 101 welcomed Andrew Graham, former leader of one of Canada’s largest insurance brokers, PC Insurance, to discuss financial planning and budgeting for entrepreneurs.

Though previously of the corporate world, Andrew has had his toes dipped into entrepreneurship for some time and fairly recently made the leap to entrepreneurship full time. One of his projects, which he co-founded, is Toronto Homecoming, a social venture that helps connect talented professionals living abroad with career opportunities in the Toronto region.

In his talk, Andrew outlined the basic aspects of financial planning knowledge needed by entrepreneurs to avoid common pitfalls. He discussed in detail three main tools that are critical to all entrepreneurs.

  1. Income statement: This is an account of your company’s financial performance over a period of time (usually for a year, a quarter or a month).
  2. Cash-flow forecast: This tool allows you to track the movement of real cash into and out of your business.
  3. Balance sheet: This is an account of assets and liabilities at a particular point in time.

Andrew used case studies of real companies’ financial statements and explained what each line item includes and how to calculate it. He also shared information on terms you may have heard, but are not overly familiar with, such as EBITDA.

For more details and to hear further tips from Andrew, watch the full video here.

Produced by MaRS.

Next lecture: Recruiting on March 26, 2014


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Lauren Seymour

Lauren worked with the entrepreneurship programs team at MaRS. She kept track of thousands of event attendees and assisted in marketing efforts to keep them coming back for more. See more…