I once took a class called "Accounting For Non-Accountants." The class was taught by a CPA who said that business owners often hand over their accounting to someone else. He identified this as the biggest mistake business owners make in their businesses. Business owners need to understand what is happening with their money. He didn't mean that business owners need to do the accounting tasks.

Many business owners get into business to do what they love to do. Paying attention to money feels like a big distraction, and they are eager to let someone else take care of it. People who get into business to do what they love can also be influenced by the idea that money will come if they do what they love to do.

I once heard a charismatic speaker talk about money in his business. He talked at length about his office manager who took care of his finances for him. He said that he was so grateful that he didn't have to think about money at all, and was free to do what he loved to do. He lavished praise on his office manager for her ability to take care of the money for him.

The next time I took a seminar with the same speaker, he told a very different story. He talked about how heartbroken he was because his wonderful office manager had embezzled more than a million dollars from him. He treated the money as a distraction from his work, and so handed over complete control to someone else. This is the big mistake the CPA talked about. By treating money as a distraction, he missed the essential different between a business and a hobby.

The function of business is to make money. The IRS has criteria to determine whether you have a hobby or are running a business. The difference concerns whether or not you make money with what you do. When you have a hobby, you can do what you love and forget about the money. When you start a business, forgetting about the money can be the quickest path to business failure.

Isn't it ironic that the one thing that stands between doing a hobby and running a business is money and yet the one thing many business owners find most distasteful about being in business is handling the money?

When you stop to consider that the reason to have a business is to make money, it seems very shortsighted to surrender the most important part of your business to someone else. The other extreme is to spend so much time keeping track of the finances, paying bills, and doing data entry that there is little time or energy left to do what you love.

So what do you do about the money? Money is the lifeblood of your business. And knowledge of money is power. When you give up control of your money to someone else, you're giving away your power as a business owner.

What happens when you hand over knowledge and responsibly over money to someone else? In the worst cases, you are a potential victim of embezzlers and incompetents. In the best cases, you will never be completely in control of your business as long as you don't understand what is happening with money. Regrettably, there is no royal road to business that allows you, as the business owner, to leave money to others.

The solution is to understand that your business exists to make money. As a business owner, it is up to you to control the money coming in and going out of your business. You don't have to do the data entry, but you do need to understand the data.