You don't need an accounting degree to run a profitable business, but you do need to read a profit and loss statement, know where your cash went, and notice when a job or product isn't paying its way. The books below teach those skills in plain language.
We chose books that are still in print or widely available, and we confirmed each title and author on the publisher's page, the author's own site or a major bookseller. Where we give a publisher and year, it's for the edition we could verify. Book advice is general, so talk to your tax professional before acting on anything tax-related.
Reading helps you ask better questions of your books. If you'd rather have someone keep them, see our list of bookkeeping services for small businesses in Boise or learn about our small business bookkeeping.
How we chose these books
- Written for owners and managers, not accounting students
- Real, verifiable books, confirmed on a publisher, author or major bookseller page
- Teaches something you can use in your own books within a month
- Covers at least one of: financial statements, cash management, pricing and profit, or systems
- Stays useful even as tax rules change
Profit First by Mike Michalowicz
Profit First: Transform Your Business from a Cash-Eating Monster to a Money-Making Machine flips the usual formula. Instead of Sales minus Expenses equals Profit, Michalowicz argues for Sales minus Profit equals Expenses: set profit aside first and run the business on what remains.
The revised and expanded edition was published by Portfolio (Penguin Random House) in 2017. The method relies on separate bank accounts, which your bookkeeper should know about so transfers are recorded correctly.
- Portfolio, 2017 (revised and expanded edition)
- A cash-management system built on separate bank accounts
- Also available as an audiobook read by the author
Worth knowing
- More a behavioral cash system than an accounting primer
- Extra bank accounts mean extra accounts to reconcile each month
Profit First for Contractors by Shawn Van Dyke
Shawn Van Dyke adapts the Profit First method to construction businesses. The book covers construction profit and loss statements, the difference between markup and margin, cash management and building rules of thumb for running the business.
Van Dyke is a construction business coach and also wrote The Paperwork Punch List. His site offers free templates and worksheets that go with the book.
- Markup versus margin explained for contractors
- Construction-specific P&L examples
- Companion templates on the author's site
Worth knowing
- Assumes you've heard of Profit First; reading the original helps
- Pair it with job costing in your books so the numbers are real
Financial Intelligence for Entrepreneurs by Karen Berman and Joe Knight
Financial Intelligence for Entrepreneurs: What You Really Need to Know About the Numbers, by Karen Berman and Joe Knight with John Case, was published by Harvard Business Press in 2008. It explains the income statement, balance sheet and cash flow statement, and why profit and cash are not the same thing.
It also covers ratios, return on investment and working capital, and it makes the point that financial reports rest on estimates and assumptions. Exercises let you practice on real statements.
- Harvard Business Press, 2008
- Clear on the difference between profit and cash
- Hands-on exercises
Worth knowing
- Examples lean toward growing companies rather than sole proprietors
- Published in 2008, so some examples are dated; the principles aren't
Visit Financial Intelligence for Entrepreneurs by Karen Berman and Joe Knight
Simple Numbers, Straight Talk, Big Profits! by Greg Crabtree
Simple Numbers, Straight Talk, Big Profits!: 4 Keys to Unlock Your Business Potential, by Greg Crabtree with Beverly Blair Harzog, is a short guide to the handful of numbers that matter as a firm grows from startup toward $5 million in annual revenue.
Crabtree's site also lists a follow-up, Simple Numbers 2.0: Rules for Smart Scaling, listed on the same page.
- Focuses on a few key financial indicators
- Written for owner-run firms
- Follow-up book for scaling businesses
Worth knowing
- Assumes your books are accurate and timely enough to measure
- Several printings exist, so check which edition you are buying
Visit Simple Numbers, Straight Talk, Big Profits! by Greg Crabtree
Financial Statements by Thomas Ittelson
Financial Statements: A Step-by-Step Guide to Understanding and Creating Financial Reports walks through a series of business transactions and shows how each one changes the income statement, balance sheet and cash flow statement.
The third edition was published by Career Press in 2020. It is aimed at entrepreneurs, non-financial managers, lenders and investors.
- Career Press, third edition, 2020
- Transaction-by-transaction examples
- Shows how the three statements connect
Worth knowing
- Written for a general business audience rather than any one industry
- More of a textbook than a quick read
Accounting Made Simple by Mike Piper
Accounting Made Simple: Accounting Explained in 100 Pages or Less, published by Simple Subjects, is a short overview of the accounting equation, financial statements, ratios, debits and credits, and cash versus accrual accounting.
It is a useful read before you sit down with your bookkeeper, or before you try to understand why QuickBooks shows a number where it does.
- About 100 pages
- Explains debits and credits plainly
- Covers cash versus accrual accounting
Worth knowing
- An overview, not a how-to for any accounting software
- Light on cash management and pricing
The E-Myth Revisited by Michael E. Gerber
The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It was published by HarperBusiness in 1995 as a revised edition of Gerber's earlier The E-Myth. Its central idea is the difference between working in your business and working on it.
It isn't a finance book in the narrow sense, but its argument for written systems applies directly to the books: a documented monthly routine is what makes numbers reliable.
- HarperBusiness, 1995
- Makes the case for written procedures
- Short and readable
Worth knowing
- About systems and roles, not accounting
- Its franchise-model examples won't fit every business
Where to start
If you have never read a balance sheet, start with Accounting Made Simple, then Financial Intelligence for Entrepreneurs. If cash is the constant worry, read Profit First (or Profit First for Contractors if you run a trade business). If you already read your reports monthly and want to grow, Simple Numbers is the next step.
Putting the reading to work
Every book on this list assumes your records are accurate. The payoff comes when you open your own profit and loss statement and balance sheet each month and ask the questions these authors raise. Our articles on the monthly bookkeeping checklist and the QuickBooks chart of accounts help set that up, and our QuickBooks services include staff training with written procedures.
- Pick one idea per book and try it for a month
- Review your reports on the same day each month
- Share what you're trying with your bookkeeper so the books support it
