This is Pete Moore, Halo Academy one zero one, two minute drill. Today, we're gonna be talking about financial statements. So when I come up to you and I say, hey, love your business, would like to invest in it, Could you send me your financial statements? Okay? What are those three things and what do I need to worry about before I hand them over to someone? One is your income statement. Okay? Your income statement is your revenue minus your expenses,
minus your taxes, minus your interest. Okay? And it's gonna get down to something called net income. Okay? Our income statement is effectively a scorecard for what we have done over the season. And the season is an annual year. So January 1 to December 31 is my income statement for 2024. Okay? That includes every day of sales, every day of expenses, and it's going to
lead into a profit or a loss. If you're a business and you're looking to sell your studio or your club, we're gonna focus on your club level or your studio level EBITDA and cash flow, which is a different number than your net income. You're never gonna value your business based on your net income and we'll explain that in a later drill. What's important next is your balance sheet. And your balance sheet is basically your selfie of your business on the day that I flash
that report. Okay? It's gonna have all the cash on your balance sheet, which is in your checking account. It's gonna have all the receivables that people owe you money. It's also gonna have assets of what you bought and what you have in the ground, construction wise, and it's gonna also have goodwill for things that you've
potentially purchased. And your balance sheet has liabilities of how much money you owe to your vendors and how much money you owe to your bank and how much money you potentially owe or have sold to your investors. That is your income statement and balance sheet. And there's a cash flow statement that then turns into a differential between what you actually got in cash and what you made in operating profit, and we're gonna go through that on a later
drill. But financial statements are three things, income statement, balance sheet, and cash flow statement. And make sure someone looks at them before you send them out.