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Introducing financial statements and why it's useful to know how to read them.
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[MUSIC]
0:00
Hi, I'm Michael Watson,
the CFO here at Treehouse, and
0:09
I'm super excited to welcome to
the financial statement basics course.
0:12
Understanding how to read financial
statements is an incredibly useful skill
0:18
that can help all of us,
both personally and professionally.
0:23
However, because the conversations
surrounding financial statements
0:27
can be can quite high stakes,
people are often intimidated by them.
0:31
The CEO is asking questions about that, or
0:36
this investment bankers talking about XYZ,
and I have no clue what is happening.
0:39
Well, the funny thing is that often times,
0:45
these people have no clue what
they're talking about either [LAUGH].
0:48
Seriously though, these consequential
conversations with smart,
0:52
powerful people can scare folks.
0:56
And sometimes, they never get around
to learning this important skill.
0:58
Well, enough of that.
1:02
We've put together an approachable, easy
to understand course, that will give you
1:04
all the essentials you need to continue
to develop your financial acumen.
1:09
As I said earlier, understanding how to
read financial statements is very useful.
1:14
Financial statements tell a story about
the financial performance of a business or
1:19
organization.
1:24
It doesn't matter if you're working in
the private sector, for the government, or
1:25
a nonprofit, financial statements are an
important part of governing any entity.
1:30
They help us understand what
is going well and what isn't.
1:35
Do the strategy we adopted two years
ago translates to the results today?
1:38
Clearly, being able to talk
coherently to this subject matter,
1:43
is a very useful skill to
your career development.
1:47
There aren't many senior managers out
there who are unable to read profit and
1:51
law statements for example.
1:55
Having some basic accounting knowledge
will help you digest this course better,
1:57
which shouldn't come as a surprise.
2:01
It is accounting principles
that create the framework for
2:03
financial statements to be prepared,
specifically journal entries and accounts.
2:07
Without accounting, there would be
no financial statements of value.
2:12
That said, a deep understanding of
accounting is not a necessary prerequisite
2:17
for this course, so if you don't know
anything about accounting, don't sweat it.
2:21
You'll still be able to follow and
learn from this course, and
2:26
we'll cover some basic foundation
stuff in the next video.
2:30
Also remember, if you have any questions
while taking the course, go ahead and
2:33
navigate to the community section of
Treehouse, and ask your fellow students.
2:37
Feel free to tag me directly with
a question, I love interacting with
2:42
our amazing Treehouse students, and
it's one of the best parts of my job.
2:46
In the following videos of this stage,
2:51
we'll briefly cover
some accounting basics.
2:53
And in stage two of the course,
get into the actual financial statements,
2:56
starting with the profit and
loss statement.
3:00
If you're not interested in a short
overview of accounting principles and
3:02
recognition concepts,
feel free to skip to stage two.
3:06
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