Nov 17

This is the basic equation of business and accounting but when was the last time that you thought about it?

Charles DickensW in David CopperfieldW said:

 

"Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

What was true in the 19th century is still true in the 21st; it is not the value of the Revenue or the Expenses that matter but only the difference between them. More...

Nov 03

How much money should you spend on maintenance?

Like any other investment, and maintenance is an investment, you should keep spending on maintenance whenever the returns exceed the costs. Or, when operating with limited resources, as we always are, whenever the returns on this investment are better than the returns on the next best investment. More...

May 26

If you want to understand the human condition there are a range of options; you can consult psychologists, sociologists, anthropologists, jurists, theologians, ethicists, politicians, journalists, psychiatrists, economists, mothers, fathers and the guy next to you in the pub. For my money though, you would be best served by consulting a humorist like Terry PratchettW. More...

May 19

As I write, the American President is castigating an oil company over the massive oil leak in the Gulf of Mexico. This is what politicians do because they and the people they represent refuse to accept that life in general and engineering in particular is inherently risky. This appears to be a relatively new social phenomenon. More...

Apr 30

While I was brushing my teeth this morning I looked in the mirror and decided that today I was going to go into work and stuff something up so badly it will take 2 weeks work and tens of thousands of dollars to fix.

Don't believe me? Good because it isn't true ... but ... I have had days where I or my employees have gone into work and stuffed something up so badly that it has taken 2 weeks and tens of thousands of dollars to fix. If I (or they) didn't decide to do it then how in hell did it happen? More...

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Apr 08

A casual glance at these two maps shows that nations with the strongest Rule of lawW are pretty much the nations with the strongest EconomyW and vice-versa. Why?

While this is a highly complex question that has engaged great minds for millennia that is not going to stop me from throwing out my own off the cuff answer. More...

Mar 18

Many people think that they are in business to make money and this is certainly an important objective, however, it is not the only or even the most important reason for being in business. More...

Mar 03

There are basically 5 methods of generating an income: 

  1. Welfare: If you are reading this blog I assume you are planning for something better.
  2. Salary or Wages: You work for a boss and are paid for your work. Again, I assume you are planning for something else.
  3. Self-Employment: You work for the public and are paid for your work. A lot of people who think they own a business are actually in this category.
  4. Business Owner: You own and work within a business; part of your income is in payment for your work and part is through the profits of the business. It is the differencebetween this and self-employment that I would like to discuss.
  5. Passive Investment: You own a ton of shares, bonds, property and/or cash and it generates so much money you will never be able to spend it. This is where I hope you are going. More...