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I am sure you know what a balance sheet means.
A Balance Sheet is a very important financial statement in a business. It shows the financial position of the business as on a particular date. Where did the business get its funds from and how have they been used or applied? Also, called sources and applications of funds.
To a layman, a balance sheet shows what the business owes (to others, liabilities) and what it owns (for itself, assets).
Business analysts, banks, venture capitalists, vendors, et al rely on the balance sheet worth to base their decisions about the business to deal with and the terms at which they would deal.
In a financial balance sheet, everything is measured in terms of money.
But what if you were to make a balance sheet for yourself to know your worth.
It is simple.
a. List all that you own (house, car) on one side and all that you owe (loans, etc) on the other.
b. Subtract what you owe from what you own, you get your Net Worth.
But is worth measurable only in terms of money?
As individuals, how else do we develop our worth, our value.
We are living in the knowledge age. An age with far greater freedom (I can hear some people laughing) to try and to fail and to learn.
I wish to bring out another way of looking at our endeavours, of measuring our worth – true to this age.
I call it the Learning Balance Sheet.
As the name suggests, this balance sheet summarizes our experiences and our deeds. And I am not in remotely referring to the post death accounting of sins and virtues (paap and punya in hindi).
What I am referring is to our learning experiences. The mistakes that we made and the learnings that we got.
Now some of these can be measured in money but definitely not all. And I believe we need to capture even those that cannot be measured in terms of money.
Infact, those could be adding some real worth to us.
Below is an example of how a learning balance sheet looks like.
LEARNING BALANCE SHEET
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Mistakes (equivalent to Liabilities) |
Learnings (equivalent to Assets) |
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Chose the wrong PG course |
PG courses really don’t matter, the campus experience does |
|
Hiring expensive people |
They are difficult and a drag. Hire people who can deliver, may be younger who you can groom |
|
Building a new product without checking what the market wants |
Build a prototype, take it to the market and let it shape the product. Reduce cost and effort and magnifies the result. |
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I made my own learning balance sheet and turned out to be a fulfilling reminder of the journey that I have been through.
Sometimes, for a long time, our worth only reflects in our learnings and our experiences. But it is this that one day transforms into the monetary balance sheet.
What is yours? Do share with us in the comments. Click here.
Author: Vipin Khandelwal
CAclubindia
