Warning, a mentor once told me you cannot master what you do not measure.

So my warning to you is are you measuring and tracking all the key metrics in your personal finances or in your business?

Because if you're not you need to stay tuned watch and listen very carefully and I'm going to get specific.

So there are certain metrics that are absolutely essential to predictably grow your personal finances or your business finances.

And if you're not tracking them like a kung fu master, like a Mr. Miyagi Yoda, then your business could look good and there's cash in the bank but it could be failing.

So I'm going to share with you all good dozen essential business and income metrics profit and loss management accounts and balance sheet.

Gross profit cost of sales and net profit.

Deferding, come and retain earnings, revenue per staff member, staff turnover, average tenure of staff member, cash flow or debtor days, refund rates or percentages, cash in bank versus deferred income, net promoter score, lifetime client value, maximum acquisition cost, forecast budgets targets.

And if you're not asleep and you're still with me, you're going to love this. Now I'll be honest, I probably wasn't one for metrics and spreadsheets and data and numbers and you're on.

But it is so true. This just stays with me. I got taught this 15 years ago. You cannot master what you do not measure.

So here we go. Are you ready? Let's have it. Don't go anywhere. I will find you. Don't go anywhere. You need this shit in your life. It's really important.

So profit and loss stroke management accounts. So your management accounts show the estimated profit and loss of your business. You'd usually have a yearly set of management accounts and then you could track last years, year before, year before.

So your management accounts are your abbreviated or estimated profit and loss and then ultimately they'll get filed for your tax return and the account will go through them and probably change them a bit.

Now most companies I know don't even have a set of management accounts. So just give me a yes if you have a set of management accounts. Give me a no if you don't.

And the yes can be in your head as you think or you can comment if you're watching me anywhere. Now management accounts show the turnover, cost of sales, gross profit, fixed overhead, variable overhead, net profit, retained earnings, etc.

That's roughly what it is. You can get a set of management accounts off an accountant or even off the internet and you'd start with a generic set and then you'd evolve them and adapt them over time and make each line item.

You take some line items out. We don't do that in our business. You'd add some line items in. This is very important in our business.

You know, we run events. So we have cost of events in the line items. We have different trainers that we pay. So we take that out of wages because it's not a wage. It's a cost of sale. So it goes in cost of sale.

Now, Sean has said my accountant does all that. That's all good. But I definitely think you should be tracking your management accounts internally such that you get to see them seven to 21 days after month end.

So if you are not seeing a full set of management accounts between seven and 21 days after month end, you do not know what's going on in your business.

And by the way, I'm not saying this to shame anyone. I did say this is warning. This is a warning. You cannot master what you do not measure.

But we probably didn't have management accounts for years. How it would be our way of tracking the success of the company. Check the fucking bank account. All this money in the bank account would do well.

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