sitting down with Paul and Will. So they're doing what 150 or is it 112k per month? Right, we're going to be about 140. Yeah, yeah. Okay, okay. And you guys have been scaling from, is it 20k or 30k before we met? We, I think our best month before we met was probably 20. And then when we began the program, we had, in August, I think a 30k month, which was then our best. Another sort of 20 or 30k in September. And then, yeah, we've sort of exploded in in October and had our best month by a long way. Okay. So this interview, we just want to like find out what, what they did, like, I know for a fact, like, why the success of the cost of the two action, but more importantly, like what is the, not mindset shift, but what is the exact tactic or strategy that they use to change because like 20 to 150k is a seven times increase. So it's not like, it's out of the ordinary, you know what I mean? So like stuff like this, success stories like this, like, definitely need to learn from them. And I just want to hear their story and stuff. Okay. So I mean, now we just want to first, Will, can you share your screen to show proof? That's like a lot of people are skeptical and stuff, but yeah, sure. So this is our, what is it? So this is our, this, this month of October. So it's 145k. And I think we've done about $700 of returns. And then this was our previous month. So yeah, we went from 20k to 140, I guess in a month. Okay. So the infection point was like 20, 22nd September around there, right? Yeah. When we started, I think we launched our new product, I think around like, yeah, 25th of September or so. And then we started to scale it towards the end of September and then into October. Okay. Understood. Yeah. Okay. So noise, I'll blow all the stuff on the information. Do we need to look at anything else? Maybe show the lifetime as well. Oh yeah. So this is, because we've had this store since March, I think, selling the same product for about six months, then we sort of have just recently changed it. So it sort of shows since we started in March. Okay. And what's the overall profit margin for? I think, check lifetime that'll have it. I think the overall profit margin would probably be, I know the dashboard. So 24%. Yeah. And previous months were probably hovering between 10 and 15. So I'd say overall profit margin would probably be about 15% but 25% for October. Okay.  Yeah. Yeah, exactly. Even the last couple of days we're seeing, for the last week or so, we're seeing cost per click go up. Obviously, we've got election times, we're heading into Q4. So we're seeing our CPMs, even if we're looking inside the ad sets as well, the auction competition's going up a bit. So we're just in the process of, basically, we've sent the product to about five or six different people to get their own sort of content. So UGC and Hawks and testimonials, and we're going to sort of mash that up and refresh our creative to make sure we can sort of keep scaling in November and December. Okay. That's good. Q4, you just need to ramp up ad spend, even though the CPMs increase, and then just try to maximize ALE as I told you before. Yeah. So the other thing we're doing as well is we have sort of frequently bought together on our page two and some post purchase upsells. So split testing at the moment, but we will start split testing some different bundles to see which is more preferable. And we're using reconvert as our post purchase upsell, but as soon as OCU is becoming part of Shopify's native checkout, as soon as that's done, we're going to switch to one quick upsell. So that should hopefully get us another sort of five or 10% revenue at the back end to assist as well. Okay. Ken, sorry, but I think you can hear my construction sound right in the back.  How do you start this e-commerce business together? We met in school actually. So we've known each other for a while now. I think it's been almost 10 years, I think. Yeah. So I don't know. We never talked about going to business or anything in school, I guess. Like I went into, we both did uni, I guess, and we were like friends through uni and everything like the travel together, whatever. It wasn't until I think towards the end of last year, I guess. I don't know, we might have started talking about it in passing, I guess. And then at the start of this year, I think we like sat down and said, yeah, we could definitely do something together. Because I was definitely interested in something like this, but I was like still learning, didn't really know where to start. I don't know about you Paul, I think you were sort of in the same way, I guess. Yeah. So I think with myself, I built a couple of stores late last year in December, not with real, just on my own. And I was getting sort of a few sales here and there and a few profitable days, but I was still very much a beginner and didn't really know exactly what I was doing. And then what ended up happening was I had a really busy period with my full time job in January. And then I found out Will was actually trying to do a coffee e-commerce business as well. And I sort of said to him, I'll look, I'm sort of still a beginner in this, but I'm quite sure with coffee, it's going to be quite difficult as a beginner to get that up and running. I'm sort of doing dropshipping at the moment, we should sort of team up and work together. So I think we decided March, we were just going to build a store together. I didn't think it was anything formal like I will work together long term. I think we just had the plan of building one store together and seeing how it went. And then luckily that first product we did was actually the product we were advertising for about six months. So yeah, so that's sort of how we ended up working together. We've always been friends. We've never spoken about building a business together. And I think it was just by chance that we decided to build a store together. But now we're starting to segment a little bit of what we are both focusing on. And I think it'll be a much more long term endeavor now that we're going to take it a lot more seriously and then work together long term. Because you guys are still working full time right? Both of you? Yeah, yeah. But it works really well. Because Will works in hospitality. So he's his family owns a restaurant. So he works in a restaurant. And that means his hours are quite like scattered across the weekend and weeknights. But he's got most of the day free. Whereas I work just a normal sort of nine to five job. So I usually work on the business before and after work. Whereas Will works on it while I'm working. And then we get most of the weekends as well. So it actually works out in terms of like a momentum thing, it works really well. So sort of really good to shut the laptop after work. And then you've had all this work done as well because Will's been working on it during the day. If there's like supplier or customer service issues, Will's straight on it because he can work with the supplier during the day while I'm working and then vice versa when he's working. So it actually works out really well for us. Okay. What is the, because when, I know for a fact it's like when you work nine to five, it's like you are fixed income, right? It's very secure. You don't feel pressure. Like why would start a business? I don't know. I'll let Will answer because it's really different answers. For me, I had started, I sort of knew that there was more money to be made than in corporate world just through things I've done through uni. So I had a bit of a, I had a personal training business in uni where I was literally just find rich housewives and train them at their home for 40 minutes. And they would pay me 80 to $100 for that 40 minutes. And that was at uni. So I thought, okay, well, there's obviously other ways to make money. You don't just have to work in a corporate job. But then I never really took any, any other business idea seriously. And then I think I just had a couple of really poor experiences at work regarding just working really long hours, not great bosses, not great working cultures. And then I thought, well, you know, I can't really do this for the next 40 years. Something has to give. So it's probably through that little bit of pain, I guess, where I thought, well, yeah, the only other alternative is starting a business. So that's, that's why I wanted to do it. Yeah, for me personally, like my parents have had a like brick and mortar business for like 20 years. And so like, I've kind of like grown up in a restaurant. So like, you can see like, like everyday activities, you can see like where the pain points are in running a business and everything.  But like, watching my parents build their brick and mortar business, you can see a lot of like, I guess, shortcomings like areas where I thought running an income business could succeed in this like current climate, I guess. That's where like I got my interest, the income from. Understood. Understood. Why, what's the, where is the, because you guys went in together generally and stuff, right? So when you got a bit of traction, what was like the biggest difficulty that you faced together at that point? Cosport, you already was, you're really doing some self, right? Then will when you came in. So what, what was the struggle to scaling up to really big numbers? I mean, I guess when we first, when we started selling our first product pretty well in March, we probably had a couple of opportunities where we could have really scaled up a bit harder than what we did. And I think the first thing was just probably cash flow and a bit of fear, I reckon. We had never really spent much money on ads and we didn't really have, we had only put in a little bit of our money each into a bank account. We didn't have a credit card. So we were sort of limited by what our cash flow was. So we probably couldn't scale up any harder than, than what we did at the time. And then around May, I think it was late April and May, our return on ad spend was actually really good. But we sort of got caught in the middle of when the COVID shipping prices skyrocketed. So that, that, that meant our break even or our margins took a real hit. And I think our break even return on ad spend was too for a period of time. Which sort of makes it difficult to scale to higher ad spends. The other thing is, to be honest, I think we just lacked the skill. So we did, we were just like, we were beginning media buyers. So we didn't really know what to do to push it to higher spends. And then we were also beginning marketers. So, you know, it's, it's fairly easy to get to sort of $500 a day, a thousand dollars a day, but to get to anything more than that, you know, everything has to be, you know, a bit more optimized than what it was. So our landing pages weren't as good, our creative wasn't as good, our offers wasn't as good. So it was, it was probably a combination of those three things, to be honest. Okay. I'm sure. Then how, how did you find me then? Because I'm scattered around Facebook. So I'm not like posting consistently and stuff. What's the I found you, because I remember you put a case study in the Ecom Empires group. I can't remember the exact case study, but it was, I think I watched it as well. You filmed like a video and it was like how you scale just thought it was like a 30 minute video. I don't think in like June or something. Yeah. And then I think I watched that one as well. And I was like, Oh, who is this guy? Because like, I've never, yeah, like I've never heard of you and stuff. And I was like, it's pretty amazing that you can take a store to like, like seven figures that quickly, basically. Okay. Yeah. So I think I ended up joining and I think we will do as well your free group after we saw that, that case study video.  And then I saw your post about doing like a, you know, your paid sort of program. And that was when we were stuck at about $20,000 revenue a month.  Like, you know, from the case, from the case study, it wasn't your typical case study, you sort of went right in depth. It wasn't the typical like value posts that we all know in those Ecom groups. And then I think I messaged you and I was actually reluctant to do it because I thought it might work better for branded Ecom. And obviously, we're still doing, you know, we've moved to a 3PL in China now, but technically still doing sort of generic products that anyone can do. So drop shipping. I think there's a bit of back and forth between us. And you sort of said, Oh, look, it's, you know, it will definitely help. And then I sort of chatted to Will about it. Will was happy to do it. And then we got in involved that way. But yeah, it all started really from that case study, I think in the Ecom Empires group. And then we joined your free group and all your sort of posts and knowledge meant that we were trustworthy of your knowledge. And therefore we were happy to go and be mentored by you. And then, and to be honest, I've sort of seen other people who had success quickly. And a lot of them have said like, Oh, the quickest way to success is just paying someone who knows a lot more than you do. So you can basically absorb it quicker, rather than just trial and error, which is what we were doing to begin with a lot of trial and error and figuring it out on our own.   Then like, once you got to a level, getting from 100 to 300k a month is harder, harder than going from zero to 100.  So I guess what is your, when you were going from 20 to the first 100, right? What is the tactic or what's the strategy? Do you think that really shifted the, or is it something that I really taught you that, hey, this is the strategy that actually works. We have one landing page, one offer, then we just run smash traffic. Like what, what changed between when you guys were doing it yourself when versus, you know, after the program? I think you definitely gave us like, really good SOPs to follow. So like we could, and then it sort of taught us like, because I think at the start, we were kind of just like, we were just guessing basically, like, we put this here, here, here, is this working? We never really like, we didn't understand like split testing, optimizing pages or anything. And like, kind of like looking at what you gave us really helped us with that. And like, I think it was also just like, just learned our learning curve in general, I think helped us to just like better understand like what it is that the message like what is an offer, what is like the messaging that we want to get across to people and like how to optimize that, I guess. And so I think that was, for me, I think that was the most eye opening thing and like the most important thing to take us from like the 2020 came months to like a hundred. Okay. Yeah. That's it.  I mean, I was just going to say a similar thing. Like, we, we had a general structure of what we, what we did with a landing page when we launched the product. And we had a general structure of creative. But yeah, honestly, it was mostly your SOPs that were sort of modeled on the absolute best landing pages. As soon as we started molding our landing pages around that now messaging and our offer, our conversion rate sort of skyrocketed. And then that just let us spend a lot more money on ads, basically. Yeah. And even, even some of the stuff like when I think there was an interview with, I think his name's Brian, and he was talking about just creating really, really good offers. I think when we made that switch from like offering the product is like, okay, here's a product. And, and started offering it as like, here's a solution to the customer's problem. And sort of started to reframe it that way. That's when we found more success. That's it. Does it feel different at 100K per month? Is there? Oh, no. Not really, not really. Just more money in the bank account. Okay. Yeah. Okay. Like how much time do you guys spend on your SO now? Or is it now is more thinking about business development and just growing? We, I mean, the other thing that you helped us with is we were, we hired a VA straight away. As soon as, you know, even when we probably weren't, when you were looking at our numbers and like what we were doing, we probably shouldn't have been hiring a VA, but I think that was a big change as well. Because as soon as a lot of those customer service tickets taken care of it gives you more thinking time for the business. And it's, yeah. So that, that, that was another thing as well. Yeah. Sorry. What was, what was the question again? I kind of forgot as well. Sorry. Okay. No, no. It's like, how much time do you spend? Yeah. We still spend a fair bit of time, to be honest. I would say, I would say it's at least, you know, it's most of the weekend and and then a few hours every day. So I would say anywhere between like, you know, 20 to 30 hours a week. Yep. H as well. So yeah, we're still sort of, because we're always trying to get better. So we're always running a new split test. We're always getting your creatives done. And then we probably had a few issues with our supply the last couple of weeks, the last couple of weeks with that, with that holiday and then just getting the supply used to doing higher volume that probably increased the workload a little bit. Our plan really, like our plan is we know it's going to be hard work for the next few months, until the new year. But our plan that we've sort of decided to make is just try and make as much money as we can over the next three months. And then probably spend January of next year, basically getting it down all our processes in the business and trying to hire as much as possible to cover for that. So that Will and I are basically just either managing VA's or finding new products or running split tests and sort of focusing on higher level stuff. Yeah, I understood. I actually think you guys should just, because you have so much data so that you've got the email list already, so you just diversify into other traffic source plus products as well. And then if you're on Google Ads then make it stable, you know what I mean? Yeah, that's the thing. I was just going to say I've got on the Twitter list today to set up all the Google shopping for all our different products as well. So just in case, yeah, Facebook starts to take a hit or a lot of our accounts have been getting banned for no reason because of election time. So I'm sort of just waiting for the day where we wake up in the morning and our account's been banned. So yeah, I'm setting up all the Google shopping stuff today. For me, I don't know about you, but I feel skill set because two people have to do numbers, you need skill. It's not just winning product. So I think for me it's copyrighting, but what do you guys think for your side? Yeah, I think it's definitely mainly copyrighting and how you can get your message across to the customers. They'll actually listen to you. Why should they care about what you're offering them? Because everyone's selling products, but it's like why should I give my money to you, I guess? I think that is really important, yeah. And then the other thing, I think for me, was just setting up systems that other people can follow so you can automate as much as possible. I think those were basically the two things that I learned. Sorry, Paul, you got to say something? Yeah, I was going to say something similar. I think we've both started reading a lot of books on consumer psychology and all those old sales letter and advertising books. Because I think when we both started in March, we never rubbish dropshippers like terrible product pages or anything like that. Because we were always making sales and stuff like that. It wasn't as if we were starting from bottom of the barrel. We had that basic understanding because we had both done other stuff before. But I think we still didn't really understand why people purchased something and what would make them purchase. So yeah, I definitely think our skill set has deepened. But by the same token, I feel like, I don't know if you feel the same, Will, but the more you do, and I guess the higher level you get, you then get exposed to people doing even the biggest thing. And then you start to realize how little you know. I feel like we've grown our skill set. I feel like we've grown our skill set and we sort of understand why people purchased and we're getting better as business owners. But then the more podcasts we listen to, all the more people are exposed to doing bigger numbers, where we sort of understanding or realizing that we're still on a long way to go. Yeah, I mean, the people doing 3, 400 keep it. And then they just don't, they don't say anything. So yeah. And it's not, these people, like the higher you get, the less well known you want to be. That's what I like as well. Yeah. Yeah, definitely. I think the thing now is I'm starting to realize that it's really, to do it consistently, it's just about creating repeatable processes. And so you can just do it over and over again. So I suppose that'll be the next challenge for us is we've had one good month now. But you know, both of us want to do this full time. So the challenge for us is to pick it up with another month and then another month and do it over and over again, like clockwork rather than just one month and then never be seen again. Yeah. I remember one of the calls, right? I think Paul, you mentioned this is like, you feel like you can do anything. And then I know that feeling as well because it's like very liberating when you know how to run traffic and then you can just make money in any environment. So I mean, I think you feel the same way, like how, what's your, what's the next step for you? Because now that you have skill acquisition, right, then now it's what's next step for you guys. I mean, in my mind, the next step is basically getting our skill and knowledge into repeatable processes and then just all the bottom of the barrel, not bottom of the barrel, but all the tasks that we sort of spend a lot of time doing now, we just sort of take away from ourselves. And to be honest, another thing that we haven't really been doing consistently is testing new products, testing new creatives. It's only been sort of the last month that we've really picked that up. So I think to, yeah, to increase consistency, it's about just getting quicker with things. And that comes from hiring to replace ourselves so that we're working on higher leverage tasks. But then, so we're basically systemizing everything like clockwork. So if we want to go down like the make as much money as possible drop shipping route, then we're testing a certain number of products every single week. Or if we want to go down like the branded e-commerce route, then we're testing like a certain number of creatives each week for a product or, however we really want to take it, whatever is the next step, which we sort of have to both think about whether we want to do sort of more branded e-commerce or try and keep doing drop shipping. I think it's just about making sure that we can do the higher leverage tasks over and over again. And that only comes from hiring other people to do the lower level stuff and managing them properly. Yeah, we haven't taken any money out of the business yet. Like we don't really need to, which is good because we're both still working, which has been a luxury. And we both, you know, maybe if we're 20 or 21, we might want things like gold chains or cards like the Insta e-con gurus do, but we don't really care about that stuff. So we can, yeah, we have the luxury we can use that money to hire people and then just keep growing the business. And what's your inclination so far? Is it more, okay, I go branded all the way, or do I still drop ship in? Yeah. I think for me personally, I would like, obviously the real money to be made is to sell brands at the end of the day. Like if we could slowly build up a couple of brands, and then eventually sell them off in a couple years. So I don't know, to me personally, like it's good to drop ship, but also like to build a couple of brands along the way and still like then just automate as much of these tasks as we possibly could. That's just how I feel personally. My thinking is either way we go, whether we go the drop shipping route or the branded route, I think either way we just have to go all in on either one because they're still slightly different things. I guess like drop shipping, it's all about testing products being quick, scaling hard, scaling fast, whereas the branded e-converter is more like, you know, a real focus on customer experience. It's testing lots of different creatives. It's really optimizing the whole process and it's a slower process that I guess is more rewarding at the end when you might sell it compared to drop shipping. You're not really selling anything. You're just trying to make as much money as possible in a short amount of time. So I think, you know, whatever route we go down, I think we just have to be fully committed to that because I feel like if we sort of go half, half like, oh, we'll keep doing drop shipping, but then we'll try and build this brand on the side, then I think that's probably a recipe for disaster. I think, yeah, the more focused we are on whatever path we go down, the better it's going to be. You guys are still working full-time. Is there a dollar amount you're looking for to transition or is it, is it still half in, half out? I don't really have a dollar. I think like, well, Paul kind of said this a while ago, like we'll kind of know when we're ready to transition out, I guess, of our full-time jobs. I don't know whether it's like, we're, our company's like fully automated. We have like key people in each like area of the business. And I guess like, yeah, I don't know. I haven't really put a dollar. I don't know if you thought about this before, but I haven't really put a dollar amount on it. But I guess we'll just kind of know when we're ready to transition fully to doing ACOM full-time. Yeah. Yeah. Yeah, I mean, I guess the way I, I haven't put a dollar amount on it yet, but I feel like we probably both need to sit down and do it at one stage just because I sort of know with this, this thing and I've heard other people talk about it as well where they sort of, they, they'll always move the goalpost further and further away. So it'll be like, all right, well, we'll need to replace our income. Okay. Now it's, we need to treat the three times our income on that needs to be five times. You sort of keep moving the goalpost further and further until you're kind of running away from the, the painful choice, which is well, as soon as you take away that stable income. It's like, it's kind of, yeah, you've got to make it work or, yeah, all the line. Yeah. So I think we both need to figure out a dollar amount. But to be honest, I've sort of had in my, in my head that if we can continue at this rate for the next couple of months, then we would have enough cash in the bank to do it, to do it full time for, to basically give us a runway of at least like six or 12 months. And then I think if we were to commit to it full time with the increased capacity we have and more, more energy to spend on things, I think we would then see more success rather than all of a sudden the business crashes and burns and we don't have any money for six months and we have to go back and find jobs. Yeah. But I think it's still a mental barrier for us. Like, yeah, we've always had a stable income. So, yeah, that's probably the next, the next step for us. So even transitioning is the part time potentially as well. So, you know, rather than going like, oh, we either quit or we stay working full time, potentially both of us go, oh, we'll just take like part time jobs and then for three or six months, see how that goes. And if that goes well, then okay, we quit on this day. Yeah. Okay. I just last question since there's not enough time, but I know you guys very, very intrinsically motivated already. Like, that's not an issue, right? But do you think, okay, I cut the nets, cut the safety net and then get this, you know, when you like really need something to work, then you'll like do all you can. Do you think that's like, or nah? I think that would be a factor for sure. Yeah.  Yeah, you have to like now, if you like leave it an extra day, it's okay. But like when we're now in the incomes coming from the business, I guess, you're like, okay, this has to be done like right now.  Yeah. Which changes your mindset a little bit. But then it gets like, what is


some of the best salmon in an air fryer you've ever had. Let's get to it. Take your salmon, lay it on some sort of contraption to keep it elevated out of the bowl so we can get this skin off. Boil in water and we pour right over the top. Now your skin should peel right off.  We're gonna use some sriracha as a binder. Now we reach for the Dano's Hot Chipotle. If you've never had the Hot Chipotle on salmon, well, you're missing out. Give your air fryer a spray. Drop in your nuggets and give them a little spray. 400 degrees for 10 minutes. It's been 10 minutes. I'm not waiting. I'm going straight in. Look, it's still bubbling. It's okay, I'll hold it in my fingers because I love you. That is hot and packed full of flavor. Yum, yum, get you some.


update project. It is the 28th of April, 2022. Thanks for being here. So today we're going to take an outdated screenshot. Let's see. Oh, and my screen is not shared right now, is it? No, no. Share my screen. So sharing my entire screen. And now here is the spreadsheet of outdated screenshots. So now how did I get to this sheet? I used our our contributon folder on Google Drive and inside the projects folder there under screenshot update, there's this sheet outdated screenshots. And so each member of the team has a link to this folder and they can find this outdated screenshots page. So then let's make this thing big enough to actually read. So what it is is we had done several checks to see are there which things need a screenshot update. And we looked at one of them that we looked at was blue ocean getting started. So this link right here says it needs the plug-in manager screenshot updated. So I'm going to open that page. Okay, so here it is. This is getting started with blue ocean and this page, the available tab does not reflect what how how the product currently looks. So let's go look to see how the product currently looks by looking at a Jenkins installation that's running. Oops. Okay, let's get a Jenkins installation that's running weekly instead of me using fat fingers. There, okay. And here I need to fill in the correct password. Okay, so this is a Jenkins version that's one week out of date, but only one week out of date. So I'll get it updated. It's close enough for this purposes to make this these screenshots useful. So if we look, let's just compare the between the two. I'm going to page back and forth between them. So here's it was on the available tab. Notice how different the available tab is here compared to here. So there is definitely a difference in in those two pictures. This one, the old tab had install name version. The new one has install name released, and has a lot more information on each row about the plugins that are available. So this is a really good one for us to update the screenshot. Now the challenge is it helps me if I know roughly how big that picture is. So I'm going to save this just to remind myself. Okay, I've saved it. Now if I go here and how big is it just to just to see. Okay, so properties. So this thing is 1820 by 1250. So it's quite a large screenshot. So I can I can certainly make it smaller than that and not do it any harm. Good. I see that I'm safe there. So this screenshot and what it's showing me a picture of is available tab. So I'm going to actually narrow my window to something much smaller so that the message will get across. How about there? What do you think? Is that a reasonable width for a screenshot because then I'll trim it down? Yes, it is.  It's a it's been very helpful for me in terms of taking pictures. You could use whatever screenshot tool works for you on yours. I then do an edit. And now I can crop this image. So that it's showing plugin manager. And now I have to scroll way down here to get because I don't need to show all that much. So let's look. Now let's see what the other one looked like. So it had what do you think is that okay, it has the buttons on it. Oh, no, wait a sec. I'm taking the wrong page. No, this is available. Okay. So it showed the buttons on it. I'm not showing the buttons. Do you think I should I should probably include the button somehow? Shouldn't I? Yeah, you should. Yeah, which means I've got to do something different then because because this list is just too long. This picture is too long to use that way. So what I probably want to do is I'm going to save save this two different ways. I'm going to save here. Call this done cropping. Now I'm going to download it. See download and export. And then I'm actually going to open it locally. With a program that does image editing like paint. And now I've got it here in Microsoft Paint or whatever image editor you use on your on yours and I'm going to go make changes to bring this thing into what I want. So I'm going to cut this stuff. Oops. Right again. Let's cut from there. Okay, I just did a cut and I'm going to go up here. I'm going to do a paste and if I scroll it down a little bit. I can align it somewhere like there. Yes. Okay, so now admittedly this is. I had to do that little bit of edit and now I'm going to do a crop. To throw away all the extra stuff that I don't need. Oops. How do I get there? I need to shift the screen just a little. Let's go. You can tell I don't do image editing as often as I should do. Okay, so cropping this image like this. Nope, I still don't quite have. Okay, so I'm going to have to zoom. Aren't I view? Oh, oh, here we go. If I just know that wasn't what I wanted. Okay, so how am I going to? How? Oh, I bet there's a way to do it like this. Sorry, so I'm not that you're having to watch me do screen editing. Isn't that just terrible?  No, it's not. It's okay. Oh, I know what to do. I see. If I grab this. Nope, that was not the answer. Okay, how am I going to? Did you try something out? I did, but I don't know how to do the zoom here. Okay. So there's a hundred percent. What's what's the zoom function in this editor? Yeah, I think you could reduce maybe take it to 80% something like that. Yeah, the challenges, I don't know. I don't see a control here that will let me do that. So maybe I need to just try a different program. Let's I think the hundred percent. I think it slides. It has a slider. Oh, you think it does. Okay. Well, so let's do that. I certainly. Oh, not with photos. Oh, actually. Well, let's we want to open this with paint. Okay. And you were saying that you think there's a slider here. Yeah, right at the bottom of the screen. Oh, oh, very good. Thank you. Like this. Yeah, it's nice to have people who actually know things. Thank you. Thank you. So now we're going to fix my mistake by jumping down here to the bottom. Cutting this much. What just happened? I must have killed my web browser in my paint program. Reopen. Try it again. Okay. Sorry for making you watch me practice. Okay. So what we've got to do here really truly mark. Okay. What we've got to do here is scroll down to the bottom. We're going to copy this chunk. Okay. It's copied. Now I'm going to jump up to the top. And I'm going to paste it. And then I'm going to move it into position. So that it looks. Reasonably correct. Like that. Okay. Yeah. So now I need to. And what you were saying is that if I will just be able to be a little smarter, I can do it like that. And now it's all on screen and I can do the crop. Like this. See, none of this has anything to do with committing the change, but it's, it's actually quite important. Now. How do I tell it to cut? Nope. That's not it. I want. Clearly I need a tutorial on how to edit images with paint. Okay. So. Where? Oh, there is a. Crop. Look at this. All right. Image editing complete. So now I do a file save. And now it helps if I know the name of the file. So going back here to that. No, not that one to this one. The original file name. The original file name. Is what it's blue ocean plugins filtered. So the reason I can tell that is that's the URL that was used. So that's the file name. I want to give it just for my convenience. So back here. Blue ocean plugins filter dot PNG. No. Oh, right. That's the old file. We don't need that. So that would have been another way for me to get it. Now this should be the new file. And it is. Okay. So we have successfully after much pain and sorrow. Found a way to get that file. So I need to copy this. Now I'm running on a windows computer. So I need to get it to my Linux computer. You would do the easy thing and drag it around. I can't do it quite that easily because I have to. Copy it from windows to my Linux computer. And here it's that. All right. So. Now let's go where. Now we're going to get to do the fun part. So this is where we're going to create this poll request. So here's my clone copy of. Oh, let's see. Would it help you if I did the. Started from a fresh copy of the repository. Neither of you probably have copied this repository yet. Have you? No, I haven't. Okay. So let's start fresh. All right. So. We need to get a copy of the Jenkins documentation repository. And so one easy way to get that. Is to click the improve this page link. And that takes us to the repository. So now if I copy from here, the, the URL. There it is. Now I can go over here and I can clone it. So I'm going to say get clone. That thing. Now I'm going to add something that will make my download much, much faster. So we don't have to wait. You won't be able to add this extra little. This. Benefit thing because. You probably don't already have that. That repository locally. So I'm going to do that. Whoops. Get clone minus, minus reference. Oh, it's already there. Okay. We have to throw the copy away that I already have. Now. You'll do a clone. So you do a get clone. Of that thing. And then in that directory. I now have the repository. I'm going to do that. I'm going to do that. I'm going to do that. I'm going to do that. I'm going to do that. I'm going to do that. I'm going to do that. But I'm going to do that. Now I have the repository. And now in my case, it makes it much easier for me to work with it. Have I used the GH command and say GH repo fork. And GH is a, is the GitHub command line interface that I mentioned Saturday. So this says, Hey, it already exists. Would you like to at it? I say yes. and it knows about this one so now I need to check out a branch. I'm going to check out a branch and this is update blue ocean screenshot and how about we call it plug-in manager so no shame using nice long names for branches it helps us remember what's what's what and it should be based on upstream it is good all right so now I've got a branch so if I do get status we'll see I've got a branch the branch is named update blue ocean manager screenshot and in my home directory I put this file blue ocean plug-ins filtered if I go looking for that file with forget LS files command it says that's where it is so I'm going to say move that file that I created into that location now when I do I get status it says hey there's something that's changed yeah that's a good thing now I've got a little script that I run that will attempt to optimize that image and I think we included that in our last set that's in the the Google Doc so I ran that script and it says sorry what was that I said it's there very good okay so so I ran that and it says hey it saved 18,000 bytes out of out of 60,000 something so that was a nice savings so now if we say get commit minus a minus v and it's a update blue ocean again manager screenshot updated live in the screenshot updates project so now gh pr create so this is I'm going to use the gh command line to create a pull request or would you prefer that I do it through the github UI first just in case you don't want to use gh okay okay okay so then let's take that step so what I have right now if we look at what I've got you'll see I have one commit after master on the update blue ocean but I don't have anything that says this has been pushed remotely so if I say get push it will tell me what do you mean I don't know what to do then it tells me what to do I choose this get push set upstream that so what this does is pushes my change to the remote github and it gives me back this nice hint of what I should do next and in the what I should do next it says create a pull request by visiting this URL so if I double click that and paste that into my web browser it puts me right into the update blue ocean plug-in screenshot and you can even see the difference between the two notice the deleted page and the added page so it shows us and I like this because it shows us that the new image is significantly smaller than the old image which is is a big win because it's more readable for human beings on when they're reading documentation yeah so intentionally used a lower resolution a smaller screenshot easier to read in online docs so I'm gonna press the create pull request button now what this will do is it's going to start the continuous integration evaluation process through a series of checks and the checks will will include creating a new site that I can use to see how this looks after my change was made so you remember that today it looks like where is the page it looks like I've misplaced the page let's go here nope not there we'll go here nope we'll have to go back to the book Jenkins documentation blue ocean which was in is it no it's not installing oh blue ocean there it is okay and the page we were looking at was oh this is really sad that I don't remember which page we were even on getting started yes here it was it was the first screenshot in getting started oh now look at this okay I made a terrible mistake it's amazing the number of mistakes I can make in doing this exercise notice what this screenshot was trying to illustrate it was trying to show how to find and install blue ocean with the plug-in manager and I didn't do that oh yeah okay sorry so so the pull the pull request that I just submitted is nonsense right so so let me put a note on this that this pull request is nonsense because it's not showing what we wanted it to show sorry about that needs to show the screenshot with blue ocean filtered in the filter field do not merge this pull request yet sorry that's really embarrassing but thank you for your patience while I make mistakes in front of you I'm going to convert this to draft as a way to assure that no one else can can merge it so you can do you could do the same as well if you realize you made a mistake you just convert it to draft and it tells the rest of us don't merge this okay all right so now we need to go fix the mistake I made and the mistake I made is going to be a little difficult to fix because blue ocean is already installed on this computer oh no no that's okay it's all right it's showing it to me oh good I got lucky I'm very happy about this because it looks like blue ocean is not already installed on this computer and yet I thought I had it installed oh no no it is partially installed okay so I've got to do something different in order to get Jenkins to a condition where I can run without having blue ocean on it so just a minute while I start a new Jenkins and we're going to we're going to do a little more in this demo we've got about five more minutes before I have to end for the next meeting are you okay if I keep doing this okay no problem I already understand it okay you well so I guess the flip side is should I just stop in case there are other questions because I think you understand what what I need to do what I need to do to fix this problem is I need to start with a Jenkins that doesn't have blue ocean installed and I type blue ocean here and it shows the things that can be installed so I do have one question so if I was to do it would I need to uninstall blue oceans from my computer yeah for this particular screenshot yes you would right because I would have to uninstall it and then when I'm done reinstalled right exactly that's one of the complications of this particular screenshot update is that in order for me to do an adequate job of this one although maybe no see yeah see see Mike my system is a little bit weird in that I didn't install the top of a blue ocean thing but I installed a bunch of components that are part of blue ocean because I need the components your system will be even different because you installed the top level and so you would have to uninstall and I would have to uninstall blue ocean in order to make this screenshot be accurate okay okay so I was thinking let me let me try it myself okay screenshot and then get back to you excellent that's great if you're willing to do that that would be that would be super I will I'd say let's are there other questions or would you be okay if we called a pause for today so I can get ready for my next meeting of course of course I'm okay with that thank you for your time oh thank you and it should be I should be able to make the recording of this available I hope within the next 24 hours okay that would be nice thank you thank you okay


Hello, Slush. I'm going to do my talk in two parts.  So I'm not going to try and deal with all of the issues around privacy and data, because that's a massive, massive job, but I'm going to explain how individuals can take back control of their most important personal data. Okay, we do almost everything on the phone these days, and that means there's a lot of data, and sadly with all of that data, it means there's a lot of fraudsters who are taking our data and putting it into websites on our behalf without our knowledge, and that's a big problem for websites, and it's a big problem for individuals. Okay, that's just in the UK, about 4% of GDP, gross domestic product, people think is basically fraudulent transactions. That's a lot of cost in the web. Most people want better control of their data, but they don't want it to be really difficult to do, and that's always been a difficult problem to fix, so security and convenience is usually too difficult for individuals to get a nice, easy way of being secure. Okay, those six numbers are still the most popular password, so that convenience and security is well kind of imaged there, that if you put that in as a password, there's a good chance a bot is going to put your email into the web and put that password in, and they're going to get into your account at some point. 90% of login attempts are no longer made by humans. That's a big, big problem. Yep, so if a bot already knows that you're using the same username and password at multiple websites, if they crack it at one website, it's in their interest to go around thousands, hundreds of thousands of websites and put it into those other websites, and eventually they'll probably find that they can get in and take your account over. So none of us want to admit it, but lots of people are using easy passwords or the same passwords on multiple sites. We're putting more and more precious information onto websites, whether it be social media or into web forms, and we kind of partly have to do that to interact online, but it means there's a huge amount of data going into different websites and lots of them are being hacked. Okay, this is back in 1992, because I'm quite old, and this is how you used to put information into the web. Now luckily, the web has moved on a long, long way in the last 25 years, so we've got some pretty cool things that have happened in that period, and obviously with the web form, well, that hasn't changed at all. Yeah, in 25 years, you've got exactly the same web form, you put your information in, or the fraudster put your information in, and it's really, really difficult to stop somebody doing that. They've got lots of ways of finding your data, and they put it into the web form. They don't tell you, obviously. The website thinks that's cool. We've got a new customer. Yeah, they might check it against the database. If the information's correct, the database will say it's matched. I still don't know that it's me that's had this information put in, but effectively, it doesn't work. It's a broken system, and increasingly, it won't be a reliable way for businesses to think that they're interacting with a person. That's obviously something we've all heard about recently, so obviously, that's a very important website. It keeps a lot of precious information for all of us, or for certainly lots and lots of people, and unfortunately, it was hacked. So I'm never gonna be able to change my date of birth. I'm probably not gonna change my name, probably not gonna change my address too often, just because that information is now hacked and is sellable online. So I can't really do much about that. And that ends the first depressing part of my talk. Yeah, because these problems haven't gone away, and nobody's really solved how you can take back ownership of your data if lots and lots of other people have also got access to it. So we three years ago went out to lots of individuals, and said, well, how do you think we could solve this? How would you like this to work? And actually, they told us pretty clearly what the solution was, and it's wrapped up in six words. So they said, we want to have a voluntary way of basically having our own digital identity. We want to own it. We want to control it. We don't want anybody else controlling it. We want to control it. We want it to be private, so nobody else can see what we're doing unless we choose to interact with them. And we want it obviously to be very secure. And last but not least, we need to be able to trust that that is how the solution will work. And a lot of people said, it's a lovely ideal way we'd like it to work. It's basically how people trust that they can get into countries with this passport. But most said, we don't think it's going to happen. So we spent the last three years working on that problem. And actually, those key messages that individuals gave us formed our principles as a business, which we wrote down literally in the first month or two of working in Yoti. And most principles are really important to us because we're dealing with some very difficult issues and lots of people need to trust that if we're going to hold their personal data, that we're going to do that in a very responsible, trustworthy way. So those principles, I'm not going to go through them, but they're available on our website and they're very important to us. So the actual solution is Yoti, your own trusted identity. It's a free app and it's very easy to create. So that's the big, big challenge normally with identity systems, but they're very expensive and difficult. People usually have to go to post offices and get out lots of forms. And that of course means nobody's really solved an online identity system because that's too expensive. So what we did was we said, right, let people do it at home in their pyjamas.  We take a liveness video. You have to say three random words. We look at that with both machine and individual super recognizers, and we check that your face matches your photo ID. So with an Android phone, we can read or you can choose to read the chip in your passport, just like they do at the border control. You can do that. You only have to do it once. You do it in the privacy of your home with nobody watching, and then we check that that information matches. And if it does, that verified passport information is now unique to you on your unique phone. We then basically put all of the attributes in separate containers, and we put different keys to each one of those attributes. There's no relational database in Yoti, so your private key stays on your phone, and then that gets de-encrypted with a private key on our server, and then we basically allow you to get in just to your attributes. Nobody else can get into your attributes. Yoti can't get into your attributes. Only the person who's got the biometrics and the phone can ever get into the attributes which they want to share. So those are the key kind of ingredients to a Yoti, and it's taken three years because it's obviously a complicated thing to do under the bonnet, but actually we knew if it needed to be a two or three minute experience for somebody as an individual. And that is a Yoti, obviously it's not my Yoti, and that is a Yoti of somebody. You can use your Yoti in lots and lots of ways. So if I wanted to just prove that I'm 18 plus when I'm going into a nightclub, or 18 plus when I'm putting alcohol across a self-checkout in a supermarket, both real cases in the UK that you can use a Yoti for, you can basically say to somebody you're thinking of buying a mountain bike off a website. You can say, well, look, I've got your mobile number, but I'd really like to know who you are. So send me your verified name. Fraudsters do not want to send verified names or pictures of their real biometrics to people they're going to defraud. It's quite a simple kind of issue. That's not what you want to do if you're a fraudster. So the fraudster will give some kind of reason why he doesn't want to use a Yoti to do it. The person will say, well, you know, that's not very trustworthy, particularly as Yoti's free and you're selling stuff. So effectively an honest seller can easily give some confidence and a fraudster is going to think, oh, I need to go somewhere else where people don't ask me to use Yoti because I don't want to share my Yoti if I'm a fraudster. So there's lots and lots of ways that you can use Yoti in lots of different sectors. We have a password manager as well so you can immediately get wide utility out of Yoti where you effectively don't even have to put your photo ID in. You just have the basic Yoti and then like last past, you can keep your passwords in our vault and then use them to log into websites. So these are some of the things that on the Yoti identity platform you can do. You can sign password, connections, authentication, verification. We've been really blown away with how many people have started to use Yoti. So we were in beta for most of this year. We had about 60,000 people using it in beta and then in the last two months we had 45,000 people in store and then last month just ended, we had 60,000. So lots and lots of people have told us over the last three years that they'd like to use Yoti and that appears to be the case now that we've put it into the app stores. We've also made it incredibly easy for websites and developers to use Yoti. So there's seven SDKs, it takes one to three hours to securely integrate with Yoti and some big companies have already done that. And then you can also download it in plug-in form. So WordPress, Joomla Drupal, particularly popular websites. And if you'd like to talk to me at some point afterwards about Yoti, I'd love to talk to you. Thank you very much.


Welcome everyone to the course on managerial accounting. Today, we are going to discuss about what do you understand by managerial accounting, what is the need to know about accounting and little bit we will go into details of financial statements. First question which may come to the minds of those who are not accountants is is it necessary for them to understand to know what is accounting and finance. You can see this question that I have a person, I am an engineer or I am a doctor, I am a person from a non-finance background what is the need to know the accounting. As you all know as you move up the ladder in your organization the need for your specialist knowledge will go down. What you will need is more and more knowledge about management and more information about finance. Your job content will be more towards knowing what other people are doing, evaluating their performance, setting the goals in financial terms, looking at what is organization doing. So it will be necessary to know the financial terms, it will be necessary to understand the financial statements, it will also be necessary to evaluate the performance of your subordinates in financial terms. That is why the knowledge of accounting and finance will become more and more important irrespective of what specialization you are from. What we are going to cover today in managerial accounting is a we will know what is accounting, then we will try to understand the difference between financial accounting, cost accounting and management accounting, we will look at the similarities and differences between financial accounting and financial management and then we will see how complexity of business affects the finance function as a whole. The first part we will think about accounting. What is accounting? Accounting in very simple terms is language of business, the intention of accounting is to record the transactions and to present the financial results. So the performance is reported and evaluated in financial terms, the knowledge of accounting and finance is also very important for personal investment and tax planning. Now the purpose of this course is not to make you an accountant. So you need not be an accountant but it is very useful for one to understand accounting and financial concepts and the terminologies. Now we will go to managerial accounting wherein as we have said we are going to see the similarities and differences between financial accounting, cost accounting and management accounting. These are the three streams of accounting which have a good number of similar points but there are a few differences also. It will be good for us to start with that, the first one is financial accounting. Now the financial accounting starts with the recording of financial transactions. Once the financial transactions are recorded, the second job of financial accounting is to prepare financial statements which will lead to reporting of financial results and the targeted users are mainly external users. There are a variety of stakeholders, they could include owners, they could include lenders, they could include employees, they could include government, they could include regulator. All the stakeholders demand that financial statements are prepared properly and the financial results of any organization is presented in an objective and fair manner and that is the main role of financial accounting function. Second is cost accounting. In cost accounting there are four activities, first is naturally to record the cost, the second one is analysis of the cost, the third is preparation of cost statements. The target of cost accounting is mainly internal users. Now I have given the first function, the recording of cost slightly in a different color because recording of cost mainly is covered by recording of financial transactions. As such there is no need to record the cost again, it will lead to a duplication of work. So recording of cost need not be duplicated. The second activity is analysis of the cost and that is very important because financial accounting may give you the ultimate financial results, but it may not give you the detailed break up of cost. When we prepare cost accounting records or cost accounting reports, the intention is to know product wise cost, it may be function wise cost, it may be machine wise cost. One would like to know a variety of detailed cost for salary, detailed cost for raw materials, detailed cost for transportation. So function wise details of the cost, all these details will be provided from cost accounting records and the statements are prepared by cost accountants which give a table of cost analyzed and presented in the variety of ways. The target users are internal users, they could be managers, they could be those who are in charge of controlling and regulating the cost or they could be decision makers who would like to look at other alternatives for a particular activity. Now, we will go to the third that is management accounting. In management accounting again the first step is recording of financial and other data. I have again put it in a different color because this is already covered in financial accounting, perhaps the data may be already available, the detailed financial and cost data is available when you go for management accounting. The second part is very important that is analysis of financial and other information and preparation of statements for managerial decision making. Now managerial decision making is a very vast term, the decisions could be tactical ones that is short term ones, they could relate to the choice of raw material, they could relate to the choice of transportation options, they could be long term like setting up a new plant and machinery or starting up a new venture, taking over a company. Now for taking any short term or long term decision, a variety of information is needed and it is the role of management accountant to make available the required information by the level of management which is requested for that information. Now, here as we have seen the targeted users are internal users and they are a variety of levels of management right from a very basic supervisory level, it could be middle management, it could be top management, it may be CEO, it may be board of directors, all the levels of management continuously need customized information and management accounting tries to provide the required information, it is to be made available at a right time, it should be concise, it should be accurate, all this is becomes the responsibility of the management accounting. That is why management accounting is usually considered as a broader concept, it includes or encompasses financial as well as cost accounting. When we talk of financial accounting, our concentration is more on recording the cost and reporting to the external users. When we talk of cost accounting, we collect financial data, we also collect detailed cost data, the data is analyzed and it is presented cost wise and when we talk of management accounting, it compasses both these functions. So, we have financial data, we also have cost data, the entire data is analyzed in a systematic manner and then it is presented to the right level of management. I hope the difference between these three terminologies is clear to you. Now, we will go to financial management. Many times the term financial accounting, management accounting and financial management are used sort of as an alternative to each other as if they are, they carry the same meaning, we will try to understand the similarities and differences between these two. Now, financial management mainly looks at the raising and utilization of funds. For any organization to run its activities, it requires finances, it requires funds or capital. So, the first job is making the capital available. The capital will be made available by raising resources. The sources could be through capital market. It could be through loans. It could be going for an IPO. One needs to analyze the cost of capital. One needs to take the decision about capital structure. By capital structure, I mean the owners and the board has to decide what should be the component of loans, what should be the components of owner's funds. Because these decisions are taken, the actions have to be taken for making the funds available. All this is generally covered in the function of raising of finances. The second part of financial management deals with utilization of the funds. Now that the funds are available, they could be used for a short term use or they could be used for a long term use. Generally the utilization for a short term use is for capital budgeting. So, here the variety of projects are taken into account. Then those projects are evaluated. A suitable project or a set of projects are identified. One may also look at the working capital management. Working capital management mainly concentrates on short term utilization of money. It will cover inventory management. It will cover the management of receivables. It will cover cash management. There is also an aspect of effective utilization of surplus funds. It may be in the form of portfolio management. So one has to look at where to put these funds, what return can come, will they provide the required liquidity, is the risk being properly managed. All these things are primarily covered in the function of utilization of funds. As we have seen the financial management slightly goes beyond the course or the beyond the space provided by this course. So, we will be concentrating mainly on managerial accounting and we will not go much into the details of financial management. Now, we will look at one more aspect that is complexity of organization. As we have seen the finance function encompasses a variety of things. The need for detailed financial function increases with the growth of business. Because as the size of business grows, the business becomes complex. There are more and more stakeholders. Usually the ownership and management becomes separated. For example, let us say you start with a very small business. The owner himself provides the capital. The owner himself is the manager. So, we have same person giving capital, same person managing. Loans may be very small or loans may be coming from relatives or close friends. At such there is no diffusion of ownership and management. Whereas, as the business grows, it may become a partnership firm. So, there will be a number of owners. One may go for a loan from bank. As the size further grows, business may convert itself into a company. So, we will have a number of owners in the form of shareholders. Other stakeholders like banks, lenders will also increase. Suppliers or customers may also diffuse. There may be stakeholders in the form of regulators or the government. So, as the complexity of the business increases, it becomes very important that the business transactions are recorded in a systematic manner. The results of the business are reported in an objective manner. It is also necessary then to look at how is the management of finances, is the business earning a good return for the owners. Is the risk properly evaluated? Is the risk properly managed? So, as the complexity of the business increases, it becomes more and more necessary to concentrate on the finance function. Now, we will talk a little bit about what is going to be the coverage of the course. We are going to cover the three streams of accounting which we have just discussed in detail that is financial accounting, cost accounting and management accounting. Financial management will be dealt with in a separate course. So, we will not deal in detail in this course. Now, let us go to the second part of today's session that deals with the financial statements. Whenever we talk about financial accounting or reporting, the final outcome is in the form of financial statements. So, it is very necessary for us to know what is a financial statement, what are the important statements and what is the purpose that these statements serve. Now, financial statement is a very wide term. A variety of statements which we give financial which will give financial data are termed in short as financial statements, but the important financial statements as are publicly reported are profit and loss account, balance sheet, cash flow statement. If you look at the annual report of any of the companies which are listed with the stock markets, you can see minimum of these three statements made available to the entire public. Apart from this, there could be a number of statements for the internal users. They could be cost estimates, they could be budgets, they could be financial report for a particular division. Now, each of the financial statements actually serve a variety of purposes and they are prepared with a different focus in mind. In short, we can say that balance sheet is intended to be a statement prepared at the end of a period to show the financial position of the concern. Profit and loss account talks about the profitability about how effectively the business is run in a particular year or in a quarter. Financial statement talks about how is cash coming in and going out. We are going to discuss in detail about these statements. Let us go one by one. Before going into financial statement, let us understand how a company or a particular business goes or runs. For running the business, one naturally requires resources. Resources cannot come for free. They have to come for, come from providers of funds or providers of money. That is why at any point of time, both of this should match. Resources should be equal to the providers of the money. Now, we are looking at the basic business model. You can see here, this is a cycle which starts with money. Usually it follows by the procurement of raw material. There is a consumption in the process of manufacturing of raw material or completion of work. We get the finished goods output. Then there is a delivery. There is billing. There is collection. And once the collection is over, the money is received back. In nutshell, this can be considered as money cycle. Now, these two things, infrastructure and people, they are required to support the running of money cycle. The money cycle is also known as value addition cycle because the money you get at the end of the cycle should be more than the money which you have put in. Now, here the same cycle is repeated. You can see that at the stage of procurement or consumption, the costs are incurred while from the point of delivery, billing and collection, we get revenues. To be profitable, revenue should be more than the cost. If there is a sufficient revenue generation or revenue creation, the business becomes stronger, healthy and long lasting. Why it becomes stronger? Because more profitability will give the capacity to expand the activities. So the health of the business will improve, better quality employees will join. This will also help the business to last for a longer period because it will have the capacity to bear recession. It will have the capacity to bear the bad times. It will generate internal resources to support the expansion. So the generation of surplus or addition of the value becomes key to the success of the business. Now let us look at how are the financial statements evolved from the basic money cycle. You can see here that we have costs and revenues coming from the money cycle. They are compared to calculate the profit or loss. On the other side, you can see balance sheet, the infrastructure which is required for the money cycle but which itself does not take part in money cycle is represented in the form of assets. The assets which come from money cycle are called as working capital or current assets. You can see human assets as well but human assets do not form part of the balance sheet though they are very very valuable to the business. They are not owned by the company. That is why it is shown but it is shown below the balance sheet. As we have discussed before, the resources for the business have to come from some providers. Resources are nothing but your assets and the providers of business are called as liabilities. You can see here there is capital, borrowings and current liabilities which are all considered as providers of business. Now you can see here balance sheet which shows the financial position of the organization and we have profit and loss account which shows the profitability of the organization. Now the balance sheet is considered as a cumulative position of resources or the assets and the sources of the business which are known as liabilities that is at the end of the year. Whereas profit and loss account shows the revenue and cost performance during a particular year. I would like you to carefully read these statements. There is a slight difference because when it comes to balance sheet we have said it is a cumulative position whereas when it comes to profit and loss account we have said it is a performance during a particular period. There is a difference in it. For example let us say if you have purchased land 10 years before and the land is not yet sold it will be continued to be shown in the balance sheet of the business. But if you have generated some sales 10 years before or say in the last year that cannot be shown in the profit and loss account for this year. So profit and loss account will show the revenue and cost only in the last year whereas the balance sheet will show cumulative financial position right from the inception or the starting of the business to the date on which the balance sheet is prepared. Let us go back to the money cycle. Here you have already seen up to this point of time that revenues and the cost the differences profits, the assets and liabilities are shown in the balance sheet. So one can very well understand that at the starting of the business on day one the assets will match the liabilities. The question is as the business rolls on as the money cycle rolls on the business will generate surpluses. The impact will be the assets will be added and the liabilities will not be added perhaps the liabilities may go down because loans will be repaired and business will have more money. Now how will the balance sheet match? So you can take a look at the money cycle. You can see here that as the business grows it generates reserves. Now reserves are nothing but accumulated profits. The surpluses or the profits which are coming from profit and loss account are built into reserves in the balance sheet that shows really the health of the business. Now here you can see that the reserves are getting built up. Now this is a balance sheet in nutshell. We have three major headings under assets that is fixed assets. There are current assets and investments. You can also see under the liability side we have got owners funds, we have long term liabilities and we have got current liabilities. Let us understand these terms once again. On asset side we have fixed assets. The meaning of the term fixed asset is the infrastructure. These are the assets which do not take part in money cycle but they are important in a sense that they ensure that money cycle runs properly. They are sort of catalysts which assist in the money cycle. I hope you all know the examples of fixed assets. They could be in the form of say land, it could be the vehicles, it could be equipments, it could be software, it could be hardware. So all those which themselves are not getting converted but which are necessary for running of the business which are necessary to support the business they are called as fixed asset. Now let us look at the second heading. Next to fixed assets we have got current assets. As we have already seen these are the assets which emerge from money cycle. So as the business rolls on we have to buy raw materials. Those raw materials stocks are the examples of fixed assets. When one does billing customers will not pay immediately. So there will be debtors or accounts receivables. You will have some surplus cash in hand. All these are considered as examples of current assets. You may have put in advances with some customers or you may have put in some advance with some say electricity supply authorities. All these will be considered as current assets. The third heading under the head assets is new to you that is investment. It is new to you because it was not from the money cycle. You can have a look again. You can see here there is no mention of investments but look at the next slide investments are included. The reason why now the investments are shown because investments are not coming from money cycle. They represent the surplus cash which is invested outside a business. It is worthwhile to understand the concept of investment properly because the term investment is used in a variety of way by different people. Suppose you invest some money in purchasing say car. Should it be considered as an investment? If you invest some money in constructing a road is it an investment? If you say a company invests some money in providing the training or education to the employees is it an investment? In broad sense yes because all these will require some cash out go. It will require some money to be spent. However when we talk of investment in the sense of accounting and finance the term is very narrowly defined. So if I have purchased the car it will be considered as a fix asset and it cannot be treated as an investment. Let us say I spend some money on education it will be considered as an expenditure again it cannot be considered as an investment. So when I use the term investment here what I mean is this is an extra cash this is a surplus cash which is invested or which is put in outside the business. So we have got three main categories under the assets there is a fix asset then there is current assets and investment. Now let us look at the other side the other side are liabilities. You can see here liabilities as three headings owners funds then there is long term liabilities and current liabilities. Now it natural question is what do you mean by owners funds? Now owners funds are the money which are owned by the proprietors or the owners. So this in turn has two parts one is the capital which is the money actually invested the other part is the reserves or the profits which are generated by the business but they very much belong to the owners. So the total of capital plus reserves is shown as or is considered as owners funds. The second heading is long term liabilities by long term liabilities we mean a variety of loans the loans could be from banks it could be from friends or relatives it could be by way of raising money by debentures all this money is considered as a long term liability. The third heading is current liabilities. Current liabilities are mainly the liabilities which emerge from money cycle. You can have a view of the earlier slide once again you can see here from the money cycle I have shown an arrow which says that current assets or working capital is emerging from money cycle. Now this working capital includes current assets as well as current liabilities. So this current liabilities are the short term funds which are continuously changing hands I will give you an example. So the example could be outstanding salaries it could be the amounts which are payable to the suppliers of goods it could also be some telephone bills or electricity bills which are pending all this taken together are considered as current liabilities. Let us go to the next slide now. Now here we are discussing about a variety of financial statements. This financial statements the best source for you to get these statements is in the form of annual report. Now an annual report will usually contain financial statement but apart from financial statement you will see notes to accounts you can see disclosure of accounting methods analysis of financial statements there will be management discussion of results there will be auditors report and there will be a comparative financial data for last 5 to 10 years. My advice to everybody is you have to look at the annual report of 2-3 companies the annual reports are freely downloadable on internet or if you know any shareholder of a particular company the shareholders also get the annual reports in physical format. So I will advise each one of you to take a look at an annual report so that you really understand how the financial statements are you can also see the notes to financial statements which tell you some procedure about how a financial statement is prepared it will also discuss about the financial performance of the company during last 3-4 years and the annual report will serve the purpose of basic it will give you some idea about how the financial statements work and how they are used. Thank you.


To be honest, I mean, the opportunities are still there. So what ended up happening is in the last two years, the stock market turned into a casino. People started gambling in the stock market, and I want them to gamble as much as possible because we are not gamblers. We are professional traders. What we do is we look for patterns in the stock market. And when these patterns appear, when these patterns show themselves, we like to bet heavy on these patterns. The best example of a pattern is the example I give about Disney World. Say we're gonna make a bet that Bao is gonna get drunk. If Bao goes to Disney World, there's maybe a 50% chance he's gonna get drunk. But if you say that Bao is going to the club, there's a bottle of Hennessy and a couple Asian girls next to him. I know 100% of the time he's gonna get drunk. So I bet heavy on that situation. So just like in the stock market, instead of betting heavy on those 50-50 setups, I'm betting heavy on Bao getting drunk at the club with a bottle of Hennessy.