Should Small Business Owners Take Accounting Classes?

You may never have been to business school, and that’s fine. Plenty of entrepreneurs find success with little or no formal business training. With that said, taking some courses in accounting can be advantageous on a number of levels. It’s not mandatory, but it can certainly help you lead a more prosperous company while avoiding certain financial pitfalls.

Keeping the Books

If nothing else, every small business owner needs to know how to do some basic bookkeeping. This is non-negotiable, as proper financial record keeping is not just pragmatic—it’s a legal requirement! Failure to keep accurate books will attract all the wrong kinds of attention from the IRS. (Then again, is there such a thing as good attention from the IRS?)

Moreover, proper bookkeeping will help you avoid late fees and overdue penalties while ensuring your company has proper cash flow. Finally, knowing something about bookkeeping will help small business owners to avoid being cheated or taken advantage of when they hire external accounting firms.

Planning for Success

Another reason to invest in some basic accounting courses: It will help you write a business plan. Business plans can vary, but you’re not going to be able to develop a very good one if you don’t at least know about balance sheets, income statements, and cash flow statements.

A business plan, in turn, will provide some direction for running the company—and will also prove essential for attracting potential investors.

Getting the Lay of the Land

Finally, and crucially: Knowing about accounting is really pretty important for assessing whether your company is succeeding or failing.

Simply put, a lot of small business owners think they are doing well because they’re bringing in money—but their long-term expenses are much steeper than what they’re bringing in. Without a proper knowledge of accounting, it can be tough to realize that the business has a major, underlying problem.

Accounting is not just for accountants, in other words; it’s for every small business owner to study and explore. You may not feel the need to become a full-on financial guru, and that’s fine—but understanding the fundamentals will only help you in your pursuit of excellence!

Start your own study of accounting today: Check out our full list of accounting resources, courses, and webinars!