The Flaw
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About this ebook
Math 101
Profit = Revenue − Costs
What happens when you lower costs?
Accountants never seem to realize that when companies cut costs, the profit should grow. However, this extra profit is actually the proceeds of the cuts, and should be used to cover the budget deficit, not to pay business owners a bonus.
Accountants are rarely interested in math, and mathematicians are rarely interested in accounting. That’s a pity, since the cause of, and solution to, budget deficits have more to do with math, than with accounting. Accountants never doubt the tools they use, and they are usually not very knowledgeable about the built-in error correction that is necessary to prevent budget deficits from happening.
Millions of companies are downsizing themselves into bankruptcy, without ever realizing that downsizing and cutting costs actually aggravate their problems. Henk ter Heide has rediscovered a trick that was used by Dutch family-owned businesses to prevent losses and budget deficits from happening. Back engineering the trick, he has found a flaw in the business accounting system that causes losses and budget deficits in companies and governments. In the changing economic circumstances of the late 1960s, the trick was lost.
This book contains all the information a starting company needs to avoid getting a budget deficit.
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