Unless you are an accountant, you probably don't love accounting. Even some accountants don't and no one can blame them. No wonder, accounting and most accountants have never made it to the cover of Vogue.
However, smart people such as Warren Buffet endorse it highly and even suggest that one should never pick stocks unless one understands accounting. Even if you don't want to pick stocks, there are other benefits where a little working knowledge of accounting can help out a lot.
1. Managing daily finances
Every company and individual can benefit from making budgets. It helps to plan, organise and better manage the future and keeps you in control. Financial literacy isn't difficult to attain and its benefits are large.
2. Tracking and reporting
There's a lot of truth to - you can't control what you don't measure. Accountants are taught to be obsessed with tracking and reporting. That's almost a daily requirement. For non-accountants, the habit of tracking their goals, habits, time etc. can help reveal patterns that they weren't aware of. Once you know the problem, it becomes much easier to diagnose.
3. Documenting and auditing
Audit documents, expenses receipts, verification of vouchers etc is not the prettiest part of an accountants job. However, these habits and skills ensure records are well maintained and available for future use whenever there's a need. It is easy to over-rely on memory and accountants outsource it to detailed documents. This micro-habit can easily be inculcated by anyone to reduce moments when we kick ourselves for not remembering something vital.
4. Knowing your debits and credits
Like it or not, we have to deal with bankers and other financial service providers. You can get better deals (or at least avoid bad ones) if you can speak their language. Knowing the basics of your debits and credits doesn't take much time and will serve you quite well. Bonus - your CPA will be so proud of you!
5. Planning and forecasting
Finally, scenario planning and forecasting is an underrepresented but vital skill for accountants (and everyone else). This skill can help most others in their jobs and life as well. Give it a try.
However, smart people such as Warren Buffet endorse it highly and even suggest that one should never pick stocks unless one understands accounting. Even if you don't want to pick stocks, there are other benefits where a little working knowledge of accounting can help out a lot.
Every company and individual can benefit from making budgets. It helps to plan, organise and better manage the future and keeps you in control. Financial literacy isn't difficult to attain and its benefits are large.
2. Tracking and reporting
There's a lot of truth to - you can't control what you don't measure. Accountants are taught to be obsessed with tracking and reporting. That's almost a daily requirement. For non-accountants, the habit of tracking their goals, habits, time etc. can help reveal patterns that they weren't aware of. Once you know the problem, it becomes much easier to diagnose.
3. Documenting and auditing
4. Knowing your debits and credits
5. Planning and forecasting
Finally, scenario planning and forecasting is an underrepresented but vital skill for accountants (and everyone else). This skill can help most others in their jobs and life as well. Give it a try.
