On November 12, 2025, the US Mint announced that they had struck the final run of pennies for general circulation. They cost nearly four cents each to produce so I understand the economic rationale. There are 300 billion of them in current circulation so I don’t think they are going to disappear anytime soon. But I’m a traditionalist. I pay in cash for most items and am going to miss the penny. I still get a kick out of finding a shiny new penny that hasn’t changed color to dark brown yet. They help kids learning to count, make change, and develop their math skills (admittedly, there isn’t much evidence of this at the check-out counter these days). And they add up; ask any store owner how much they lose to credit card fees each month at 3 pennies on the dollar.
But one place where pennies have no place is on financial statements. The point of financial statements is to help users understand and better manage the business and in this context pennies are just a waste of ink (real or digital). They crowd the page, distract, and offer no value. I cannot tell you the number of times I see financial statements displayed to the penny suggesting a certain amount of precision that are just plain wrong. I have received no fewer than three this month.
- One has an inflated balance sheet where inventory and other accounts are clearly overstated. The result is that the company can’t clearly understand their financial position.
- Another has an expense line that belongs on the balance sheet (sales taxes) meaning that revenue is mis-stated. In an industry where costs as a percentage of revenue are a key metric, this mistake makes that percentage impossible to calculate.
- The third was a five-figure cash reconciliation discrepancy. My tolerance for cash reconciliation issues varies depending on the circumstances. At times it is zero. When significant financial statement remediation is required it is more, but it’s rarely five figures even in the worst of circumstances.
In each of these cases, the person producing the financial statements is missing the bigger picture. I’d much rather see financial statements presented in thousands of dollars which provides less clutter on the page so that the reader can more quickly zero in on the key facts.
Produce the financial statements, present them cleanly, and then before sending them along, ask yourself what story they are telling you. You won’t find the answer to the right of the decimal point.
There is an old saying, “look after the pennies and the dollars will take care of themselves” (I believe the original referenced pence and pounds). I think it’s time to flip the script on this one. Look after the dollars and let the pennies take care of themselves.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (513) 225-8657 or send an email to [email protected]
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your cash is flowing. know where.®
Ken Homza
Copyright @ 2025 Kenneth M. Homza