Hi, I’m Nate, the owner of ClockWork Accounting. I have a real passion for accounting, but maybe not for the reasons you think. You see many people think that accounting is a dull subject that’s only used by boring people. Real business people own businesses or work on Wall Street; they don’t ever do taxes or collect accounting information (that’s what accountants are for). Well, I’m here to tell you this isn’t entirely true.
I’ve always had the dream of being a successful entrepreneur. When I was in high school I started up a lawn mowing business with a friend. We put advertisements in the local newspaper and contacted businesses. Soon I was making more than most of my friends and doing half the amount of work. We charged $400 to mow a lawn that only took us four hours to mow (that was $200 each for four hours of mowing—not bad for a high school kid). Sometimes I wonder why I quit on that business when I left for college.
When I got into college I wasn’t really sure what I wanted to major in, but I was pretty sure I wanted to do something business-related (my dad was a stockbroker, I had started a small landscaping business, it just made sense; I like to say it was in my blood). I attended college at Brigham Young University (BYU) in Provo, Utah. BYU has an amazing business school so I got in and got to work.
Confusion
This was what I envisioned accountants did. Note that the armbands seem to be coming back into style.
I was sitting there in my introduction to business school and they started talking about choosing a major. I remember thinking that they must have made a mistake; we had all decided to be business majors and that was that. Well, as it turns out, you can’t just be a business major; you have to decide what you want to specialize in (makes you miss the renaissance days when a wealthy guy could study without having to specialize). They gave us the options: general business (finance/management), accounting (bleh), and information systems (double bleh). Easy decision for me, finance/management it was.
I was off to the races studying finance and management. The classes were great and we (the students and the finance professors) made fun of the accountants on a routine basis. I remember just envisioning them in their classes talking about taxes and doing other boring tasks that “bean counters” do. I felt sorry for them because they didn’t have the charisma or the looks to be a true businessman—luckily God has blessed me with both. I envisioned myself shaking hands with people, smiling at them, looking them in the eyes, leading employees to greater heights, throwing in a wink here and there, and closing huge business deals left and right. Accountants obviously couldn’t do any of that; they were stuck in the backroom wearing those visor hats and pounding away at their calculators. Once my business was in the Fortune 500, I would make sure that the accountants I had (a necessary evil) would be safely tucked away where nobody could see them.
Enlightenment
Somehow and somewhere along the line I got wrangled into an accounting class or two. I didn’t plan on it, but I wasn’t very careful about my college class scheduling (case in point, my first semester in college I was signed up to be in the same basketball class as the BYU Women’s basketball team; yes, the coach was a bit surprised to see me show up, but that’s a story for another day). At the end of the two introductory accounting classes I had taken, a very uneasy feeling started to settle in on me. I was learning the language of business. I learned about revenues, expenses, net income, and financial statements. I learned about home mortgages, insurance, car payments, interest, budgeting, the time value of money, and financial planning. In my finance classes (where we made fun of the accountants), my classmates were amazed at how easy I was picking up the concepts. I didn’t want to tell them the truth: it’s a lot easier to understand finance and business when you understand where all the numbers are coming from. You want to know where those numbers are coming from? They are coming from accountants my friend, accountants.
Example
Many finance classes focus on stock and business evaluation. These classes teach the basics of focusing on the company’s financial statements and using those statements to determine the overall health of a company. Finance majors use the statements to project the future earnings and expenses of a company. But who makes these statements anyway? Accountants. These financial statements have so many estimates and judgment calls built into them that it really isn’t funny, but people who don’t understand accounting rely on these statements as if they were facts.
On more than one occasion my finance teachers would say something like the following: “Don’t worry about where these numbers on the financial statements come from; just plug them into the financial model or equation, the accountants make them—what a boring job right? (cue class laughter).” At first I laughed with them; it’s true that it’s a boring job. But then I couldn’t reconcile something in my mind. I was going to be making extremely important business decisions based off numbers that I honestly had no idea where they came from or what they represented. Simply run the latest ROI technique that everyone else was using and laugh myself silly all the way to the bank??? This doesn’t work; you have to know what the financial statements mean. The best way to learn what they mean is to learn accounting.
Learning the Language of Business
I realized that if I wanted to become a great businessman I needed to understand how to speak business-ese. The best place to learn the business language is in accounting. I switched majors and joined the dark side, or should I say dull side? To my surprise, many of my classmates were exciting people who wanted to start businesses too. They had learned the same valuable lesson that I had: you need to understand accounting to be good at business.
Accountants are often compared to historians. They are basically capturing the history of a company. My finance major friends often made a compelling argument with me: you don’t have to be a historian to make history. I definitely wanted to make history and they brought up a good point. However, my counterargument is that most people who make history have a solid understanding of the world they live in. They understand the past and are therefore able to better predict the future. In short, if you want to be able to understand business, you had better know some accounting. Clockwork Accounting is here to help you understand accounting. This site is intended for those who have absolutely zero experience with accounting and also for those who are just looking to brush up on a few accounting topics.
Credentials
I’m not bragging, but I know my stuff (okay, maybe I’m bragging a bit)
- Bachelor of Science in Accounting from Brigham Young University BYU (#1 Ranked Accounting School in the world according to Wall Street Journal and others—depending on the year of course).
- Master of Accountancy from Brigham Young University (Top 5 Ranked Accounting Master’s Program in the world).
- High Distinction Award, Beta Gamma Sigma Member, Phi Kappa Phi Member, Magna Cum Laude
- Worked at Ernst & Young (Big 4 Accounting Firm)
- Great enthusiasm for teaching
Feel free to ask me any questions in the comments section below.
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