1. Money
Susan Ward

Are You Financially Literate Enough to Run a Business?

By January 22, 2013

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Maybe not.

When Intuit Canada quizzed a selection of Canadian small business owners to see how financially literate they were, 83 percent scored at a basic or below basic level.

Financial ratios: a health checkup for your business.

And the questions weren't exactly super difficult, either. Participants were asked, "What is the role of the balance sheet?", for instance. And "How can short-term cash flow be improved?"

Kind of makes you wonder if the participants were also watching a game on big-screen TV and checking their email on their phones at the same time, doesn't it? ("Darn that multitasking! Now just look at my test score!")

But Intuit Canada says not.

And frighteningly, only 35% of one-person small businesses "always realized that financial management is the one of the most important things I should spend time with" while only 1 in 4 of small businesses with one employee believed that financial training would make them more profitable.

Canadian small business owners were also asked what help they would like to see to improve their financial literacy.

  • 22 percent chose online tutorials
  • 24 percent chose information sessions with other small business owners
  • 42 percent chose time with an accountant

If you're one of those small business owners who feels your financial knowledge is weak, have a look at my Business Finance Makeover. Working through it will help ensure your business finances are in good shape.

Read the entire Intuit Canada report: Bridging the Gap: How Boosting Financial Literacy Leads To Small Business Success

About Business Financial Statements

Image (c) Richard Drury / Getty Images

Connect with Susan: Free Newsletters | SB Canada Forum | LinkedIn | Facebook | Google+ | Twitter: @SmallBizCanada

Comments
April 18, 2013 at 6:17 pm
(1) dave h says:

Big shocker here.

Intuit who makes financial software gives survey results that show that businesses would be better with their software.

The sad thing is this is given credibility – duh!

Of course according to Intuit everyone is better using their tax software too.

I have a wrench, it doesn’t make me a mechanic – software is the same it it merely a tool.

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