The art of finance

The art of accounting and finance is the art of using limited data to come as close as possible to an accurate description of how well a company is performing. Accounting and finance are not reality; they are reflection of reality, and the accuracy of that reflection depends on the ability of bookkeepers, accountants, and finance professionals to make reasonable assumptions and to calculate reasonable estimates. It’s a tough job. Sometimes the accountants and finance folks have to quantify what can’t easily be quantified. Sometimes they have to make difficult judgments about how to categorize a given item. None of these complications necessarily arises because they are trying to cook the books or because they are incompetent. The complications arise because they must make educated guesses relating to the numbers of the business all day long. —p18, Financial intelligence for entrepreneurs