Chapter 6 - Building Your Pro Forma Financial Statements

“I’ll hire an account for that”.  My sentiments exactly until I read chapter 6 of The Portable MBA in Entrepreneurship on Building Your Pro Forma Financial Statements.  Admittedly, I have a very weak business background and usually avoid topics on finance, accounting, and/or economics.  In our bi-weekly meetings, my least favorite segment is the review of the financial reports at which point I reflexively tune out.  I do understand that this is a serious handicap and I hope to curb my handicap via my MBA pursuits.

Much like the previous chapter (chapter 5) on Business Planning, chapter 6 breaks down and explain each section of a financial statement in much detail.  In fact, the authors piggyback on the previous chapter by also providing various examples of worksheets (Balance Sheet, Revenue Worksheet, Income Statement, etc.) which I’ll be showing our financial officer (who also has a Computer Science degree) and president.  Aside from the various charts, tables, and worksheets that may come in handy, the section titled Common Mistakes in which the author(s) inquires about the most common mistakes in an entrepreneurs business proposal from several professional equity investors, will hopefully also prove useful as we work towards developing a solid business plan.