Charlie Munger: The Complete Investor
by Tren Griffin
Charlie Munger (1924-2023) was vice chairman of Berkshire Hathaway for 46 years, working closely with Warren Buffett. This book is about their approach to investing, sprinkled with quotes from Munger, Buffett, and others.
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Quality of Earnings: The Investor’s Guide to How Much Money a Company is Really Making
by Thornton L. O’Glove
Thornton “Ted” O’Glove published the Quality of Earnings Report from 1969 through the 1980s, identifying red flags in financial statements for institutional investors. He wrote this book in 1987 to share his due diligence methods with individual investors.
“Often the stock can go north while the quality of earnings goes south, and vice versa.”
For example, the author provides examples of how reported net earnings growth can mask a decline in operating income — or even an operating loss.
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HBR Guide to Buying a Small Business: Think big, buy small, own your own company
by Richard S. Ruback and Royce Yudkoff
This book provides a methodology to find, evaluate, finance, and acquire a small business. The autonomy of entrepreneurship is compelling to many, but the failure rate of start-ups is high—more than two-thirds of them never deliver a positive return to investors. In contrast, this approach seeks to buy and manage an existing “enduringly profitable” business. The authors teach a course in entrepreneurship through acquisition at Harvard Business School.
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The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness
by Morgan Housel
Financial success is a soft skill, writes Morgan Housel, “where how you behave is more important than what you know.” This is a book about developing the mindset of a long-term investor, with a realistic attitude towards risk and reward. The book is conspicuously free of financial jargon and math. Here are some key points.
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How Finance Works: The HBR Guide to Thinking Smart About the Numbers
by Mihir A. Desai
This is an outstanding book which presents some complicated topics in a clear, well-organized manner with real-world examples. The author, a professor of finance and taxation at Harvard Business School and Harvard Law School, includes some sidebar commentary from two CFOs, an investment banker, and a hedge fund manager.
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Small Business Finance and Valuation
by Rick Nason and Dan Nordqvist
A finance professor and a CPA have teamed up to explain finance and risk management concepts specifically for small business, defined as assets under $5 million. They acknowledge that the objectives of small business owners often differ from those of a Fortune 500 CFO, whose focus is typically maximizing shareholder value. Freedom, peace of mind, and other quality of life issues may be more important to a small business owner.
Continue reading “Small Business Finance and Valuation”After posting more than 250 book reviews, I decided to try something new: an author interview on YouTube. I am grateful to Alastair Thomson for graciously sharing his wisdom on managing small and medium-sized businesses. Alastair has an accounting background, but this conversation is not about debits and credits. It’s about improving your business from the perspective of an experienced CEO and CFO. We cover cash flow, profit, customer experience, metrics, business ethics, marketing, quality, continuous improvement, front-line employees, growth, margins, inventory, and receivables.
An interview with Alastair Thomson, author of Cash Flow Surge
July 16, 2020 – 1 hour – Book Review – Amazon
Transcript
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Cash Flow Surge: 101 No-Cost and Low-Cost Fast-Action Strategies to Boost Your Business Cash Flow
by Alastair Thomson (interview)
In college I took a course called Small Business Finance. The main thing I remember from this course is the emphasis on “cash flow, cash flow, cash flow.” Alastair Thomson is an accountant who has been a CFO and CEO of several businesses in the U.K., across variety of industries. He wrote this book for owners of small and medium-size businesses. While cash flow and profit are not the same thing, many of the ideas in the book can improve both.
The 101 chapters cover suppliers and expenses, customers and revenue, staffing and procedures, communication, insurance, logistics, contracts, and technology. Here are some snippets:
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Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean
by Karen Berman and Joe Knight
This outstanding book teaches corporate financial literacy to nonfinancial employees. There are 33 short chapters grouped into sections covering the income statement, the balance sheet, cash, ratios, return on investment, and working capital. “You’ll learn how to decipher the financial statements, how to identify potential biases in the numbers, and how to use the information in the statements to do your job better.”
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How to Think About Money
by Jonathan Clements (1963-2025)
Jonathan Clements, a personal-finance columnist at The Wall Street Journal for some 20 years, advises how to think about work, debt, investments, and insurance at various stages of life. He puts an emphasis on preparing for retirement, starting at a young age.
“Chronologically, retirement might be our final financial goal, but we should always put it first. Amassing enough for a comfortable retirement is our life’s great financial task.” Given longer life expectancy, “we need to get ourselves on the right financial track as early in our adult life as possible, so we quickly achieve some measure of financial freedom.”
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