ReadOS / Business
Business Finance and Financial Statements — Part 4
Reading statements, understanding cash flow, profit, valuation and financial decisions.
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- 01Running a business through a boom and bustBooms tempt businesses to over-expand, borrow and extrapolate demand; busts punish them for it. A practical guide to building a business that benefits from good times and survives bad ones.
- 02Saying no to good projects: opportunity cost, balance and choosing what to fundMost proposals look worthwhile on their own. How to compare them against what else the money and people could do, keep the mix balanced and decide what not to fund.
- 03Settle the terms before the price: what to agree while suppliers are still competingYour bargaining power peaks between shortlisting and award. How to use it on reporting, standards, people and exit, surface supplier departures early and make sure your terms govern.
- 04Share buybacks: when a company invests in itselfWhat share buybacks and treasury stock are, why a history of buybacks can signal a strong business, and when buybacks help owners and when they do not.
- 05Sharing capacity with competitors: when filling an asset beats owning it aloneExclusive equipment or facilities often buy a short lead and a long cost base. How to judge when sharing capacity, selling surplus or financing customers beats owning an asset alone.
- 06Should-cost modelling: understanding what it costs your supplier to make what you buyThe invoice price is a negotiating outcome, not the economics behind it. How to estimate a supplier's costs, read the margin and decide whether to negotiate, redesign or resource.
- 07Small shareholdings: fair value accounting and its effect on profitHow businesses account for small investments in other companies' shares, how fair value is measured for listed and unlisted shares, and why market swings can flow straight into reported profit.
- 08Standing offers and schedule-of-rates agreements: buying repeat work without re-tenderingAgreed rates for recurring work save time on both sides, but convenience can drift into dependence. How to set scope, call-off rules, capacity, performance and review for repeat work.
- 09Steering a small business through a downturn: cash runway, cost review, recovery plans and pivotsA practical turnaround guide for small businesses facing falling sales or losses: scenario planning, cash runway, a 13-week cash forecast, cost review, working capital, people and pivots.
- 10Stopping well: ending projects that no longer deserve the people and moneyBusinesses are good at starting projects and poor at stopping them. How to spot weak commitments early, decide clearly, close properly and make sure freed-up people go to better work.
- 11Taking on a strategic investor: what you exchange besides capitalA supplier, customer or larger company investing in your business can bring capability and market access, and change control and options. How to map the whole exchange before signing.
- 12Team bonus or individual bonus: matching rewards to how the work is really doneMany businesses pay shared bonuses to people who work independently and individual rewards to people whose work is joint. How to test which you have and match the reward to the work.
- 13Testing the numbers you are given: who produced the estimate, and can it actually be true?Forecasts and recovery plans usually come from people who need a yes. How to treat an estimate as testimony, check the rate it depends on against the record and separate facts from hopes.
- 14The anatomy of a bubble: from displacement to panicAsset bubbles tend to follow the same broad stages, from a new opportunity through boom, euphoria and revulsion. Understanding the pattern helps you recognise where a market stands.
- 15The assets the balance sheet cannot seeWhy a company's most valuable assets, its brand and reputation, often appear nowhere on its balance sheet, and what goodwill and intangible assets do and do not tell you.
- 16The best long-term technology may not be your next investment: sequencing a transitionA preferred future technology can depend on supply, infrastructure or skills that are not ready yet. How to separate the destination from the next move, fund enablers and plan exits.
- 17The equity bond: valuing a business by its growing yieldBuffett's idea of treating shares in a great business like a bond whose interest payment rises every year, and why the price you pay still decides the outcome.
- 18The equity method explained: accounting for associates and joint venturesHow investors with significant influence account for their share of another company's results, why dividends reduce the investment, and the traps hidden in equity-accounted profits.
- 19The hidden costs of outsourcing a function: oversight, change, exit and the work nobody wrote downOutsourcing quotes cover the specified work. How to count transition, oversight, change and exit costs, and find the unwritten work a function does before a contract quietly stops it.
- 20The J-curve: why changes often get worse before they get better, and how to plan for the dipNew products, systems and pivots often cost money and output before they pay. How to plan the dip, tell a J-curve from a decline, and make the dip shallower and shorter.
- 21The one-third rule: a simple benchmark for product cost, operating cost and profitHow the one-third rule splits revenue into product cost, operating cost and profit, how to apply it to manufacturers and services, what it reveals about your business and where it falls short.
- 22Throughput is not wealth: growing without running down the assets you depend onRevenue and output measure flow. Equipment, skills, relationships and resources are the stocks that produce it. How to tell whether growth is building those stocks or quietly using them up.
- 23Time to value: the clock starts before the project doesProject schedules run from mobilisation to handover, but a business pays from decision to first revenue. How to measure and own the front-end and start-up intervals where time goes.
- 24Two breakeven numbers every owner should know: your monthly revenue floor and the rent-or-buy crossoverFixed costs divided by contribution margin is the revenue you need each month to stand still. How discounts and commitments move it, why cash differs, and how to use breakeven to rent or buy
All chapters preserve the original KEVOS Insights content. These topic-based reading collections are organised alphabetically; chapters may be read in any order.
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