How to Do a Complete Financial Review for Your Business

Mike McKay
May 17, 2024


In this month’s focus on money, we dive into the essential aspects of conducting a comprehensive financial review for your business. Uncover the key components that make up a financial review, understand the significance of positive beliefs about money, and learn to set up a crucial dashboard for your business. We’ll guide you through the three critical financial documents—Balance Sheet, Profit & Loss Statement, and Statement of Cash Flows—and how to interpret them. Additionally, we introduce a powerful tool, the cash flow forecast, to help you manage your business’s cash flow effectively.

Are Your Money Beliefs Helping or Hurting You?

Before delving into the financial specifics, evaluate your beliefs about money. Identify seven words or phrases related to money and categorize them as positive or negative. Understanding your mindset is crucial as negative beliefs can impact your decision-making and hinder business success. It’s time to confront and reshape these beliefs for a healthier business and personal life.

Setting Up Your Financial Dashboard

The first step in your financial review is to establish a reliable financial dashboard. This involves moving beyond managing your business from your checkbook and adopting accurate financial statements. Whether you’re bootstrapping your business or experiencing significant revenue, transitioning to financial programs or hiring an accountant becomes non-negotiable for effective financial control.

The Big Three: Balance Sheet, Profit & Loss Statement, and Statement of Cash Flows

  1. Balance Sheet:
    Understand the assets and liabilities of your business. Assets, such as cash and inventory, and liabilities, like loans and accounts payable, are categorized into short-term and long-term. Learn to focus on key indicators like accounts receivable, accounts payable, and equity growth over time for informed decision-making.
  2. Profit & Loss Statement (P&L):
    Differentiate between cash basis and accrual basis P&L statements. Discover why the accrual basis is essential for showcasing the actual timing of sales and expenses. Ensure a positive net income and analyze the percentage growth of profit against revenue for a well-operated business.
  3. Statement of Cash Flows:
    Explore the three sections—Cash Flow from Operations, Investing Activities, and Financing Activities. Learn to interpret positive cash flow from operations as a sign of a sustainable business and identify potential issues in investing and financing activities.

Fast Growth and Additional Insights

Beyond the financial reports, aim for fast business growth—revenue and profit should outpace the previous year. Lastly, introduce a game-changer: the cash flow forecast. This real-time tool offers a forward-looking perspective on your business’s cash position, enabling proactive decision-making.


Mastering a complete financial review is pivotal for the success of your business. Take charge of your money beliefs, set up a robust financial dashboard, and understand the nuances of critical financial documents. To further enhance your financial management skills, we invite you to join our upcoming session of BusinessRICH. Don’t miss the chance to make more and work less—empower your business with sound financial strategies.

Ready to revolutionize your business’s financial health and learn more about how you can further elevate your business?

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