Why Doesn’t My Profit & Loss Statement Match My Bank Account?

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The Business BFF with the Women's Accountant

Emma Bowdler, The Women's Accountant

22 episodes

20 hours ago

Welcome to the Business BFF, the podcast where fierce and fabulous business women come together for the kind of real talk and honest advice only your besties would give. I'm your host, Emma Bowdler, founder of The Women's Accountant, and I'm here to help you navigate the wild world of business, finance, and life, whether you're scaling up Starting fresh or just need a pep talk from someone who gets it, you're in the right place. So grab your favourite bevy and get comfy. It's time for a chat with your business BFFs.

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All content for The Business BFF with the Women's Accountant is the property of Emma Bowdler, The Women's Accountant and is served directly from their servers with no modification, redirects, or rehosting. The podcast is not affiliated with or endorsed by Podjoint in any way.

Welcome to the Business BFF, the podcast where fierce and fabulous business women come together for the kind of real talk and honest advice only your besties would give. I'm your host, Emma Bowdler, founder of The Women's Accountant, and I'm here to help you navigate the wild world of business, finance, and life, whether you're scaling up Starting fresh or just need a pep talk from someone who gets it, you're in the right place. So grab your favourite bevy and get comfy. It's time for a chat with your business BFFs.

Show more...

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Why Doesn’t My Profit & Loss Statement Match My Bank Account?

The Business BFF with the Women's Accountant

11 minutes 42 seconds

8 months ago

Why Doesn’t My Profit & Loss Statement Match My Bank Account?

In this episode of The Business BFF podcast, host Emma Bowdler (founder of The Women’s Accountant) explains why your profit and loss statement might not match your bank account. We explore common reasons for this discrepancy, including accrual accounting, the exclusion of GST and loan repayments, the impact of drawings and dividends, and the treatment of asset purchases. Emma breaks down these concepts in an easy-to-understand way, helping you gain a clearer picture of your business's financial health.

Key Takeaways:

Accrual Accounting: Income and expenses are recorded when invoiced or incurred, not when money is received or paid.
GST and Tax Exclusions: GST and income tax are not reflected on the profit and loss statement.
Loan Repayments: Only the interest portion of loan repayments is included as an expense on the P&L.
Drawings and Dividends: Withdrawals by business owners do not directly impact the profit and loss.
Asset Purchases: The full cost of assets is not expensed immediately but depreciated over time.

Timings:

00:00 Introduction

01:21 Accrual Accounting

03:45 GST and Tax Exclusions

05:02 Loan Repayments

06:36 Drawings and Dividends

08:08 Asset Purchases

09:53 Conclusion