Understanding Your Financial Statements

This session was originally delivered for the Big I Montana and Big I Wyoming education series and is now being published on the AgencyFocus YouTube channel so more agency owners can build confidence in their numbers.

In this webinar, Carey Wallace, Founder of AgencyFocus, explains how to read and use your financial statements so they actually help you run your independent insurance agency. Carey breaks down the profit and loss statement, balance sheet, and statement of cash flows in plain language and shows how to turn those reports into better decisions for growth, hiring, acquisitions, and perpetuation.

Whether you are a scratch agency, growing fast, thinking about buying another agency, or planning for a future exit, understanding what your financials are really saying is essential.

In this session, you will learn:
✅ Why monthly financial statements matter more than just having a tax return
✅ The difference between profit and cash, and why solvency is not the same as profitability
✅ How to read your profit and loss statement and use benchmarks to evaluate performance
✅ What your balance sheet reveals about liquidity, debt, and owner equity
✅ When and why to use a statement of cash flows
✅ How to calculate EBITDA and why it is central to agency valuation
✅ Common financial and accounting pitfalls in agencies, including trust accounting issues

Key topics covered:

Revenue, expenses, and profit on the income statement

Organizing your chart of accounts so benchmarks are meaningful

Payroll, benefits, selling expenses, and operating expenses as a percentage of revenue

Discretionary and one time expenses and how to adjust for them

Benchmarks for compensation, technology, facilities, and revenue per employee

How valuation uses EBITDA and multiples and why two agencies with the same revenue can have very different values

Why every owner should run the business as if they might sell it tomorrow