Wharton Executive Education Essentials: Finance & Accounting by Richard A. Lambert - Book review

Wharton Executive Education Finance and Accounting Essentials

By: Richard A. Lambert

Published: October 11, 2011
Format: Paperback, 172 pages
ISBN-10: 1613630093
ISBN-13: 978-1613630099
Publisher: Wharton Digital Press

"Finances affect every aspect of business. Once executives and managers understand the rudiments of financial statements and the tools of financial analysis, managers can understand what is driving revenue, pinpoint where the organization is doing well, and analyze why performance isn't living up to expectations", writes Miller-Sherrerd Professor of Accounting at the Wharton School of the University of Pennsylvania, Richard A. Lambert, in his clear and concise book Wharton Executive Education Finance and Accounting Essentials. The author describes the critical importance of understanding accounting and financial statements as they are the guide to where the business has been, is now, and where it's headed in the future.

Richard Lambert understands that to make effective and informed decisions for their companies, business leaders require fundamental knowledge of financial information. The author points out that many decision makers are not fully fluent in the language of financial statements, and are unable to interpret the the crucial information depicted in the numbers. The ability to effectively interpret financial statements creates the opportunity to uncover potential profit points for the organization, as well as revealing the problem areas that must be addressed to avoid losses. To make informed decisions, the author provides clear evidence that business leaders must understand the language of numbers in their organization's accounting and financial data.

Richard A. Lambert (photo left) emphasizes the importance of financial literacy for business decision makers as the key to making informed choices for the company. The author provides the background to what the numbers mean, and how looking more deeply into the data offers different knowledge than seen at a single glance. Richard Lambert breaks down the basics of accounting and financial reporting, as well as providing an overview of the differences between internal and external reports. For the development of corporate strategy, it's imperative that leaders understand completely the implications of all company financial statements.

Richard Lambert offers an overview of the following areas of finance and accounting for company leaders and executives:

* What financial statements say about the health of the company
* How and when actions and events affect the numbers
* Using the Income Statement to analyze revenue, expenses, and profits
* Utilizing and financing assets effectively
* Using cost information for better decision making
* Evaluation of investment opportunities with discounted cash flow analysis
* Using the numbers to develop a complete business strategy
* A deeper study into cash flow statements

For me, the power of the book is how Richard A. Lambert not only explains, in easily understood terms and language, how financial statements work, but also how and why they are essential to decision making. The author goes beyond teaching the fundamentals of finance and accounting, and places them in the context of sound business practices, decision making, and overall company strategy. At the same time, Richard Lambert demonstrates what the numbers reveal when examined more deeply, as well as pointing out the limitations and subjectivity of the numbers for executives. With a better grasp of the financial statements and their meaning, business leaders are able to make more informed decisions. Executives can develop a much more sound strategy, than choices made without an understanding of the numbers.

I highly recommend the business building and very hands on book Wharton Executive Education Finance and Accounting Essentials by Richard A. Lambert, to any business leaders seeking an understandable guide to utilizing accounting and financial statements more effectively. This book will certainly improve an executive's strategy and decision making ability, and improve the company's bottom line as well.

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