Saving Your Financial Hide with Noura Salman
Today’s episode of Just the Tips starts off a little testy as Dean does his best to drive a wedge between me and today’s guest. But luckily, Dean’s best is still kind of the worst, and he’s unable to create any tension between me and Noura Salman, my former neighbor down in Miami and a woman who has arrived at entrepreneurship via an unusual path. Noura began her career as a CPA, but then transitioned to creating her own businesses, and now she’s bringing those sorely needed accounting skills to other entrepreneurs, helping them get their financial houses in order. On today’s episode, we talk about how entrepreneurs can sharpen their skills, hire the right person, and save their financial ass.
Breaking free of the chain at her desk
Noura’s story of how she got into accounting, and how she got out of accounting, is fascinating. Her parents struggled with money when she was a kid, and she watched that take a toll on their marriage. So she naturally gravitated toward getting ahold of her finances. But then, as she became more and more successful as a CPA, she realized that the only way she could make money was to be at her desk working, and whenever she wasn’t doing that, she wasn’t making money. So to free herself from the chain at her desk, she decided to take another path. This is a really great episode of Just the Tips for anyone who is wondering what their next step should be.
The biggest financial mistakes entrepreneurs make when starting out
As we’ve mentioned before on Just the Tips, and as Noura says on this episode, many entrepreneurs are great at their craft and at making money, but aren’t skilled in managing their money. As she says, it’s a lot like people who are trying to cut calories but afraid to step on the scale. So she recommends looking at your financial statements once a month, at least, as part of your routine, so you have a handle on what money is coming in and what money is going out. And you might just discover you’re still subscribed to that service you haven’t used in 15 months.
How to read your financial statements if you’ve never done that before
One of the problems entrepreneurs face isn’t just that they don’t look at their financial statements, it’s that they don’t know what they’re looking at when they finally do. No one actually taught them how to read their statements and how to glean the necessary information. Noura does a great job breaking down what reports you need to look at (yes, P&L is one of them), and how to read them to ensure you’re getting what you need. We also dive into net profits and what that really means, as opposed to simply money in the bank, and I promise it’s a lot more fun than all of that sounds. This is a bit of a 101 class for Just the Tips listeners, but it’s vital to running a successful business.
How to hire and manage a CPA
Not every entrepreneur is obviously going to want to spend their time keeping their books, so Noura and I do a deep dive into what you should look for in a CPA, how that person should present that information to you, and how you should work with that person to make sure you’re getting understandable information on a regular basis. We talk through how to hire someone, how to manage them, and even when to approach them with bigger projects (i.e. not around tax time). This is a really value-packed episode of Just the Tips, on a topic that can be scary for entrepreneurs, but in the end is very important.
Outline of This Episode
- [2:45] Dean tries to co-opt Noura’s friendship
- [4:00] How Noura went from bean counter to entrepreneur
- [8:40] What are the biggest mistakes entrepreneurs make when starting out?
- [11:43] How to read your financial statements
- [17:30] Why net profit isn’t actually how much money you’re making
- [21:29] How to hire out your accounting
- [29:02] What are the red flags that your bookkeeper isn’t doing their job?
- [35:00] Ensure your costs and bills are categorized correctly
- [37:40] Noura walks us through her course
Music for “Just The Tips” is titled, “Happy Happy Game Show” by Kevin MacLeod (http://incompetech.com) Licensed under Creative Commons: By Attribution 3.0 License
