Being in control of your cash flow has never been more important. Tradies Tax can help you set up detailed cash flow forecasting to put you back in the cash flow driving seat.
We all know that positive cash flow is the beating heart of any successful business – and with so many external pressures on your cash right now, it’s important to have one eye on the future.
Cash flow forecasting is an increasingly important tool for any finance team. With a better view of your future cash flow position, you can make well-informed decisions about your finances.
But how does cash flow forecasting work? How does it help you maintain a positive cash flow position throughout the year?
What Does a Cash Flow Forecast Tell You?
The cash flow process is all about balancing your income (cash inflows) against your expenditure (cash outflows). If your cash inflows are greater than your cash outflows, this is called a ‘positive cash flow position’. In other words, you have cash left over, even once you’ve covered your costs and paid your bills – cash that can then be reinvested in the business.
Running detailed cash flow forecasts means you can:
- Understand your future operational cash flow – helping you spot any cash flow holes, seasonal dips or predicted months of high expenditure before they become an issue.
- Plan your costs and expenditure effectively – allowing you to stick to your planned budgets, manage your costs and plan for any steep price increases.
- Avoid the cash flow issues before they happen – using your forecasts to look ahead, plan and get tighter control over your cash flow management.
Talk To Tradies Tax About Setting Up Cash Flow Forecasts
Staying in a positive cash flow position is a challenge in the current economic situation.
When supplier prices and operational costs are fluctuating and revenues are hard to predict, it is difficult to juggle your inflows against your outflows.
Tradies Tax can help you get a tighter grip on your cash flow. Setting up detailed forecasts helps you understand your financial story and puts you back in full control of your cash flow.
Contact Tradies Tax today for assistance with your cash flow forecasting, so you can be in control.
This blog was originally published by BOMA.