How accountants sort things can have serious consequences. And provide some fun.
In our business acumen workshops, managers talk about how they organize their kitchen or their clothes. There’s a lot of laughter as the obsessive-compulsives in the room get outed for their color-matching proclivities.
In our business acumen workshops, managers talk about how they organize their kitchen or their clothes. There’s a lot of laughter as the obsessive-compulsives in the room get outed for their color-matching proclivities.
Photo by Hannah Morgan on Unsplash
Applied to accounting, we ask questions like: should we classify the cost of a trip to meet with a client as Marketing or, perhaps, Travel? And if Travel, should we break out airfares from ground travel?
The important lesson is that we can obscure financial information by how we aggregate, slice and describe it.
For example, when a mining company’s sales are reported on its income statement by type of mineral rather than by mining region, it can disguise how much of the company's activities happen in dodgy places.
Back in the classroom, our recent favorite classification was a student who said she organized the novels on her bookshelf by how the authors would get along. Who needs alphabetic when you have that kind of insight?
Peter
The important lesson is that we can obscure financial information by how we aggregate, slice and describe it.
For example, when a mining company’s sales are reported on its income statement by type of mineral rather than by mining region, it can disguise how much of the company's activities happen in dodgy places.
Back in the classroom, our recent favorite classification was a student who said she organized the novels on her bookshelf by how the authors would get along. Who needs alphabetic when you have that kind of insight?
Peter
Photo by Dmitri Popov on Unsplash
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