Jackie
porter
Five financial lessons every female business owner should know
About Me
Jackie is an awarding winning certified financial planner, best-selling author, and featured speaker who has helped thousands of clients grow their net worth, build a fortress around their finances, and keep more of their cash in their pocket for 25 years and counting! Her focus is on empowering women towards financial independence.
Jackie has been featured on the star, CBC, the agenda with Steve Paikin, BBN, and is also a regular contributor to investment executive, wealth professional, and the globe and mail. As Mackenzie female trailblazer of the year for 2019 and 2021, Jackie is a leading money expert and a powerful voice in the world of women's financial empowerment.
Taking control of your business
Is the Honeymoon Over In Your Business?
Are you on the Hamster wheel?
Note: If you don’t have a plan for your business- Your business will have a plan for you.
questions to ask
What is your why?
What problem are you solving?
MINDSET: THE ROAD TO BUILDING WEALTH
Cultivate a positive cashflow mindset
What you manifest for your life grows
Respect the law
of attraction
Is the business working hard for you or are you working hard for the business?
Keep in mind what you manifest for your life grows! Anyone by a car lately? How many of you see that car everywhere? If you tell your brain my business is about me working hard it will believe you…Believe deep in your heart that you deserve to be wealthy
How many of you are immigrants to Canada? I am a first generation Canadian who was raised by single mom who came to Canada as a domestic worker. I watched my mom work hard so that she can me and my sister and keeping a roof over our head with her numerous side hustles that including catering, Tupperware, Coppercraft. I could go on. I was often accompanying her on her side hustles because child labour laws are not what they are now. At the age of 16 I lost my mom and had to grow up quickly.
Embrace money conversations around building wealth
Its only after entering the financial industry that I finally understood the principles of real wealth and the power of building passive income that finally my life changed for the better. You see my mom passed away in my teens and so I had to grow up really fast. And I was grateful that her strong work ethic rubbed off on me. So I worked three jobs to get through high school and university. And it was a tough go but it was all I knew until I was introduced to the financial concepts around the power of building wealth at the tender age of 26. I decided that I did not want the last 10 years to look like the next 10 years so I decided to learn everything I could about these concepts so I could make money work for me. It led me to create a 7 figure net worth and income. And I am not special… but it does start with taking the first step to truly understand your company’s financial position and look at strategies to improve it.
Learn something new about money each year
Any one remembers Malcolm Gladwells book outliers? You become an expert at anything you practise for 10,000 hours. So practise is key.. Choose to challenge yourself around learning something new about money to help you improve the financial health of your company over the long term.
Become familiar with the financial health of your business
If you don’t respect your money your money wont respect you
$123
Take a closer look at your numbers
$123
Get educated on what your numbers mean
BE INTENTIONAL
Don’t be an ostrich and avoid looking at it while working tirelessly at your business when it comes to your business cashflow
Do you know if your business is profitable?
How much cashflow your business Generates?
How much you would have left over if you paid your business bills and sold the company?
How many of you have reviewed your financial statements with your accountant?
How many of you have a clear understanding of what it says?
know your numbers
- Income statement – Similar to a family cashflow statement
- Business generating a profit or loss?
- Spending more or less than it earns?
- What does it cost the business to produce its product?
- How much it’s paying to produce its product?
- Is money left over to reinvest?
sample income statement
Company B
Income Statement
For Year Ended September 28th, 2019 (In Thousands)
net sales COST OF SALES GROSS PROFIT | 4,358, 100 2, 738, 714 1,619,386 |
SELLING AND OPERATING EXPENSES GENERAL AND ADMINISTRATIVE EXPENSES TOTAL OPERATING EXPENSES OPERATING INCOME | 560,430 2,93,729 854, 159 765, 227 |
OTHER INCOME GAIN (LOSS OF FINANCIAL INSTRUMENTS) (lOSS) GRAIN OF FOREIGN CURRENCY INTEREST EXPENSE INCOME BEFORE TAXES | 960 5,513 (12,649) (18, 177) 740, 874 |
INCOME TAX EXPENSE NET INCOME | 257, 622 483, 232 |
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BUSINESS INSIGHT: An Income Statement Example Here’s an example of an income statement for the year that ended on September 28, 2019. This income statement tells you: 1 The company brought in a total of $4.36 billion through sales, and it cost approximately $2.74 billion to achieve those sales, for a gross profit of $1.62 billion. 2 A total of $560.43 million in selling and operating expenses and $293.73 million in general and administrative expenses, were subtracted from that profit, leaving an operating income of $765.23 million. 3 Additional gains were added to the operating income and losses were subtracted, including $257.64 million in income tax. 4 By the end of the year, the company saw a net income of $483.23 million.
THE CASHFLOW STATEMENT
- A cash flow statement provides a detailed picture of what happened to a business’s cash during a specific duration of time, know as the accounting period.
- It demonstrates an organizations ability to operate in the short and long term, based on how much cash is flowing into and out of it
THE PURPOSE OF THE CASH FLOW STATEMENT
- •By reading a cash flow statement you can see how much cash different types of activities generate, then make business decisions based on that analysis.
- •It’s important to note that cash flow is different from profit, which is why a cash flow statement is often interpreted with other financial documents.
Company C
STATEMENT OF CASHFLOW
Year ended March 30, 2020 (In Millions)
CASH AND CASH EQUIVALENTS, BEGINNING OF THE YEAR | AMOUNT $10, 764 |
NET INCOME ADJUSTMENTS TO RECONCILE NET INCOME TO CASH GENERATED BY OPERATING ACTIVITIES: DEPRICIATION AND AMORTIZATION DEFERRED INCOME TAX EXPENSE OTHER CHANGES IN OPERATING ASSETS AND LIABILITIES ACCOUNTS RECEIVABLE, NET INVENTORIES VENTOR NON-TRADE RECEIVABLES OTHER CURRENT AND NON-CURRENT ASSETS ACCOUNTS PAYABLE DEFERRED REVENUE OTHER CURRENT AND NON-CURRENT LIABILITIES CASH GENERATED BY OPERATING ACTIVITIES | 37,037 6,757 1,141 2,253 (2,172) (973) 223 1,080 2,340 1.459 4,521 53,666 |
purchases of marketable securities proceeds from maturities of marketable securities proceeds from sales of marketable securities payments made in connectION with business acquisitionS, net of cash acquired PAYMENTS MADE FOR ACQUISITION OF PROPERTY, PLANT AND EQUIPMENT PAYMENTS FOR ACQUISITIONS OF INTANGIBLE ASSETS OTHER CASH USED IN INVESTING ACTIVITIES | (148,489) 20,317 104,130 (496) (8,195) (911) (160) (33,774) |
DIVIDENDS AND DIVIDEND EQUIVALENT RIGHTS PAID REPURCHASE OF COMMON STOCK PROCEEDS FROM ISSUANCE OF LONG-TERM DEBT, NET OTHER CASH USED IN FINANCING ACTIVITIES | (10,564) (22,860) 16,896 149 (16,379) |
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS, END OF YEAR | 3,513 $14,259 |
operating activities
AMOUNT
investing activities
AMOUNT
FINANCING activities
AMOUNT
AMOUNT
The company started the year with approximately $10.75 billion in cash and equivalents. 2 It brought in $53.66 billion through its regular operating activities. 3 It spent approximately $33.77 billion in investment activities. 4 In addition to investment activities, it spent a further $16.38 billion in financing activities, making for a total cash outflow of $50.15 billion. 5 The company ended the year with a positive cash flow of $3.51 billion, and total cash of $14.26 billion.
THE BALANCE SHEET
THE BUSINESS NET WORTH STATEMENT
Assets = liabilities + owner’s equity
Captures what the company owes/owns
Owner’s equity
If the company was sold today what would the owner have left over?
The income statement and financial statements are key documents your business needs to be reviewing on a regular basis at the very least quarterly.
Company A
As of June 30, 2019 and June 30, 2020 (In US$ Thousands)
assets
non-current assets brands customer relations leasehold rights capitalized expenditures goodwill buildings and land equipment, tools fixtures and fittings long-term receivables deferred tax receivables total non-current assets | june 30, 2020 $255 71 537 631 64 805 18,326 628 1,624 22,941 | june 30, 2019 $302 84 585 - 64 804 16,589 608 1,234 20,270 |
current assets inventory accounts receivable tax receivable other receivables prepaid expenses short term investments cash and cash equivalents total assets | june 30, 2020 15,213 2,207 477 1,056 1,136 2,995 14,148 $60,173 | june 30, 2019 13,819 2,337 - 1,375 1,110 6,958 14,319 60,188 |
liabilities and shareholders' equity
non-current liabilities provisions for pensions deferred tax liabilities total non-current liabilities current liabilities accounts payable tax liabilities other liabilities acquired expenses and other deferred revenue total liabilities shareholders' equity share capital reserves retained earnings total shareholders equity total liabilities and shareholders' equity | june 30, 2019 $377 1,961 2,328 june 30, 2020 4,234 - 2,765 7,011 $16,338 june 30, 2020 $207 (1,900) 45,528 43,835 $60,173 | june 30, 2019 $377 950 1,327 june 30, 2019 4,307 1,851 2,428 6,171 $16,084 june 30, 2019 $207 (487) 44,384 44,104 $60,188 |
BUSINESS INSIGHT: A Balance Sheet Example By looking at this balance sheet, you can extract vital information about the health of the company being reported on. This balance sheet tells you:
1.The reporting period ends on June 30, 2020, and compares against a similar reporting period from the prior year.
2.The company’s assets total $60,173, including $37,232 in current assets and $22,941 in non-current assets.
3.The company’s liabilities total $16,338, including $14,010 in current liabilities and $2,328 in non-current liabilities.
4.The company retained $45,528 in earnings during the reporting period, slightly more than the same period a year prior.
So many business owners have a business for many years that don’t pay them.They don’t draw a salary from the business. They are on a hamster wheel of working for the business instead of the business working for them. It is a fast track to being burned out. And that is why having a business plan that sets up an emergency fund to pay expenses in the first couple of years when the business is starting, is so important.
Does the business pay you?
Review the numbers in your business quarterly
Change direction if necessary
Beyond that if your not profitable the government is going to audit you to find out why you are still in business after so many years and not making money. So before this happens you should ask yourself the same thing. Review the numbers in your Business Quarterly to check in on the financial health of your company and change direction if something isn’t working.
drawbacks of not taking an income
Not building CPP
Not eligible for income replacement insurance or government programs
Cannot qualify for a loan or mortgage
How to build/rebuild business financial health
Be selective when choosing an accountant and bookkeeper
Choose wisely
A savy accountant is key
They understand your industry
They give guidance on how your business is doing
They have a gameplan for how you will work together
Do you do a mock return to see how much taxes you will be owing
Do you meet with him outside of tax season to discuss business goals and objectives and how your plans will affect taxes now and in the future?
For example if you plan to buy a home and you have been reducing how much you take as income from the business, you may not want to do that if you plan to buy a home- especially as mortgage restrictions have become tighter. Your accountant would likely recommend you increase salary to make it easier for you to qualify. Vet them by asking them, how often will we see each other, how will we share and secure my financial information, how will you work with my bookkeeper and how familiar are you with my industry?
rebuilding your financial health pt 2
Have a system for staying on top of your expenses
Record your expenses monthly with your bookkeeper
Setup a monthly
financial reporting
Organize your tax documents
Make a financial date with yourself
- Review your income statement monthly
- Your balance sheet quarterly
- Commit to learning about your company’s financial health
If you're talking to your accountant only at tax time you are already too late
Tax planning not one and done
- At least twice a year discuss personal and financial plans in relation to taxes
- Get into the habit of year round tax planning
Look at strategies to pay less
- Incorporation, RRSP, HSA
- Shareholder loans
- Number of strategies to consider
- Earlier vs later in the year
leverage: the key to growth
Female business owners wait too long before they get financing
Reluctant to borrow to build business
Limits their ability to grow and few are 7 figure earners
Get acquainted with the power of opm aka other peoples money
Can be grants or loans
Seek out a relationship with a personal banker
Investigate funding options race industry
It doesn’t have to be your money
Use OPM to protect your wealth
Accelerate growth in your business
$100000 at 5% or $5000 down
If the property goes up 5% you would of earned $5000
If you invested $5000 of your own money and earned 5% you would of made $250.
BIG DIFFERENCE
Example of leverage using real estate
The power of leverage pt 2
- Money can be earner incrementally or rapidly
- Leverage multiplies your growth
- Consider the financial impact to your business
make your network work for you
The community that supports you
Who inspires you to move forward
Your network is your net worth
Consider the energy you have around you
You don’t have to do this alone
Find a mentor
Join a business community
Cultivate a team of professionals
Your network will be a game changer as you grow
keep in touch
Certified Financial Planner & Financial Advisor in Ontario | Jackie Porter
(365)-656-3355
Monday to Friday
9:00 a.m. to 5:00 p.m.
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