How business finance software can help you to project cash flow
Business owners with an extensive understanding of their company’s financial future are at a distinct advantage over those who only concentrate on the day-to-day running of their enterprises. A cash-flow projection can forewarn business owners of upcoming cash-flow problems before they occur. Moreover, businesses that are applying for loans are expected to provide lenders with a cash-flow projection illustrating their expected profits over the following year or two.
It is imperative that a cash-flow projection is accurate and based on actual income and expenditure in order to anticipate possible financial complications in the future. Hence, business finance software is an excellent tool for small business owners, especially those who do not have a vast background in financial management.
Continue reading to learn more about how business finance software and an accurate cash-flow projection can help your business to succeed.
The basics of planning a cash-flow projection
A cash-flow projection maps out the income and expenses that are expected over a certain period of time – usually a calendar year. The first step is to take into account all cash that is on hand at the beginning of the projection. At the end of each month, all cash-on-hand will be carried over to the start of the following month.
Once you know how much money you start with you must anticipate all income that is expected throughout the year. It is important to remember that a cash-flow projection is meant to illustrate when money will actually be received. If your customers purchase goods on account, you would record the date that payment is actually expected rather than the sale date.
All additional incomes, such as bank loans, donations and investments, should be included in the month that you expect to receive them.
Once you have ascertained your expected income for each month, it is time to calculate how much money you will be paying during each month. Again, the trick is to add your expenses to the month in which you actually anticipate paying them and not when they are incurred.
Once you have inputted your income and expenses into your business finance software, you will have an accurate forecast of your cash flow for the rest of the year. A cash-flow projection needs to be constantly maintained, however, and changes to income and expenses should be incorporated into future months’ cash-flow projections.
How can cash-flow projection help my business?
Cash flow is what keeps a business running. The constant flow of money must be monitored in order to anticipate an unacceptable increase in expenses. The moment that you are unable to pay your expenses in full is the moment that your business faces trouble. Using business finance software to keep track of your finances will give you plenty of forewarning, with time to make any necessary changes before it is too late.
Peruse QuickBooks selection of business finance software to find a solution to your companies cash-flow needs.
QuickBooks SimpleStart - for new and home based business
The simplest way to manage and track money going in and out of your business.
QuickBooks Pro - manage your business accounts simply and easily
Manage your business accounts simply and easily.
QuickBooks Premier - fast and easy advanced accounting
Fast and easy advanced accounting.
Quick Payroll is designed to meet the fast growing needs of dynamic South African SMEs.
It simply manages all aspects regarding payroll, including payroll calculations, leave registers, report writing, tax year-end, and more. Quick Payroll interfaces seamlessly with QuickBooks accounting software, which means your general ledger journals will automatically update.
Our solution automatically provides new tax law or statutory upgrades as they arise, keeping you on the payroll cutting edge. What is more, our Quick Payroll is so flexible; it can be used in any industry sector, injecting value into your company, employee and client relations across the board.
Quick Payroll Lite is designed to meet the fast growing needs of dynamic South African SMEs. It simply manages all aspects regarding payroll, including payroll calculations, leave registers, report writing, tax year-end, and more. Quick Payroll Lite interfaces seamlessly with QuickBooks accounting software, which means your general ledger journals will automatically update.
Our solution automatically provides new tax law or statutory upgrades as they arise, keeping you on the payroll cutting edge. What is more, our Quick Payroll Lite is so flexible; it can be used in any industry sector, injecting value into your company, employee and client relations across the board.
Quick Payroll Startup is designed to meet the fast growing needs of dynamic South African SMEs. It simply manages all aspects regarding payroll, including payroll calculations, leave registers, report writing, tax year-end, and more. Quick Payroll Startup interfaces seamlessly with QuickBooks accounting software, which means your general ledger journals will automatically update.
Our solution automatically provides new tax law or statutory upgrades as they arise, keeping you on the payroll cutting edge. What is more, our Quick Payroll Startup is so flexible; it can be used in any industry sector, injecting value into your company, employee and client relations across the board.
