Words matter… Even if your focus is numbers

“That cannot be the way to write clearly.”

I had shared the introduction of my book, The Farmer’s Office, with my uncle Roman and this was his feedback. The manuscript was in its final stages of editing before heading to the printer.

Prior to his review of the introduction, we had a lively email exchange about the meaning of “retained earnings.” I use the term the way QuickBooks does even though it is only half-right. I knew Roman would be a direct and meticulous reviewer.

Uncle Roman, in addition to being a brash reviewer of my book, was also one of the preeminent accounting professors in the country teaching at Stanford University and University of Chicago. He wrote the textbook used in many MBA programs, including Babson College where I studied. One month into my accounting class at Babson, he sent me a quiz he used for his students. Since we used the same textbook, it was a good test of what I was learning. Or not: I failed miserably.

With his professional experiences and familial connection, I thought to share my manuscript with him. Knowing his style for delivering feedback (direct, with little regard to how it will be received), I didn’t dare send him the chapter on cost accounting. I sent him the introduction. How bad could his critique be?

As it turns out… pretty bad.

His primary criticism focused on my use of the word “money.”

“Think about what you mean here?   Save cash?  Save other assets? Save costs? Reduce expenses?  Already, you can reflect that you’ve used ‘money’ in three or four different ways in the first six pages of this manuscript. That cannot be the way to write clearly. If you avoid the word, your readers will never notice.”

Of course, Roman was right.

Roman passed away on February 1, 2023; he was 82. As I dig into writing my next book, I think about his feedback, and especially his precision in writing and word choices.

I too get wound up about accounting terms. Too often, “profit,” “gross profit,” and “income” get misused or conflated. If everyone uses a different definition of these terms, then we never really know what a business owner or advisor means.

I worked with a consultant who often talked about “Gross Income.” In business accounting, that term doesn’t mean anything. There’s Gross Revenue and Net Income, but not “gross income.” In the personal world, gross income is the salary earned before payroll taxes are taken out.

Does it really matter to get this right?

If a farmer fills out a loan application and provides inaccurate information (let’s say provides “net income “instead of “gross revenue”), they may not get the financing they need.

If a business advisor wants to benchmark how farmers in their region perform, they need to compare apples to apples (or “net income” to “net income”) and not apples to oranges (“net income” to “gross revenue”).

And if you utilize the tools in The Farmer’s Office to analyze your financials, I want you to plug the right numbers into the formulas to get a true understanding of your business.

The other lesson I learned indirectly from Roman is to know your audience. Sometimes, we need to tailor our word choices to ensure that our message is received and internalized. While I did remove the word “money” from many places in the book, I used it occasionally to keep the writing approachable. And I use the term “retained earnings” the way QuickBooks does, even though it is not fully accurate. In Roman’s honor, I added a disclaimer acknowledging that I was a bit loose in some of my word choices.

For your amusement, here are 3 bits of the actual feedback provided by Roman.

Original 1
Beyond that, good bookkeeping can actually help you save money.

Feedback 1
Think about what you mean here?   Save cash?  Save other assets? Save costs? Reduce expenses?   Avoid using the word money.  I’ve said in my books for over thirty years that accountants should avoid that word, at least in part because economists haven’t yet agreed on its definition.  If you will resolve never to use the word money—or what’s easier go back and re-write to get rid of every occurrence, this will cause you to think harder about what you mean and then you’ll be able to use more precise terms and be a clearer writer.”

Suggested Rewrite 1
Beyond that, good bookkeeping can actually help you reduce costs.

Original 2
Do you know which farmers’ market is most profitable for you? Do you know if you’re making money on your chickens? You probably have a gut instinct. But how bummed would you be, if you realized that you were actually losing money on the meat-birds? While you may be tracking that more money is coming into your business than is leaving (i.e. you are running a profitable business), it could be that some of your products are losing money. If you don’t track your revenues and expenses effectively, then you don’t know for sure.

Feedback 2
Already, you can reflect that you’ve used ‘money’ in three or four different ways in the first six pages of this manuscript.  That cannot be the way to write clearly.  If you avoid the word, your readers will never notice.”

Suggested Rewrite 2
Do you know which farmers’ market is most profitable for you? Do you know if you’re earning income from your chickens? You probably have a gut instinct. But how bummed would you be, if you realized that you were actually incurring losses on the meat birds? While you may be tracking that more cash is coming into your business than is leaving (i.e., you are running a profitable business), it could be that some of your products don’t cover their costs.

Original 3
Will that new tractor improve efficiencies enough to increase profitability?

Feedback 3
Omigod [sic]; you are confusing the investment and financing decisions; one of the BIG no-no’s of modern finance.  I don’t expect you to teach corporate finance and the M-M theorems in this book, but I hope you will write so as not to violate modern understandings.

Roman’s words continue to resonate with me, and I will carry his memory with me as I work on my next book.