She was complaining about cash flow. One look at her financials and Jim discovered that she had been doing business in the red for months. He found out that she was keeping the business afloat with cash from her not-so-large personal savings account. Sounds naive, but we're afraid there are too many owners who don't look at the numbers because they're afraid of what they will find.

Topic for Discussion: How was Vicky able to keep her company from going into debt or bankruptcy?

Answer: First, she knows where every penny in her business is or isn't because she has written sales projections and operating budgets based upon those projections. Second, she moved quickly to cut expenses when she saw she was not going to make her sales projections. In addition, her regular participation over the years with the other dealers has provided her with a superb education in dealership benchmarking.

If you don't know how much you should be spending per square foot for a lease, or how much you should be paying a highly skilled technology worker or how much you should dedicate to advertising, stop everything and find out! Most CPAs can provide benchmarking data and bankers have it too. In fact, banks are members of the Risk Management Association which provides bankers with financial ratio benchmarks by industry.

You think about it: What would you like to know about your financials that you don't now know?