SPA Services

Business / Cash Flow Planning

Business budgeting and forecasting are essential management functions and should include projected profit and cash flow budgets. Forecasting for a business can be a daunting task and producing accurate figures may be a vital factor in giving your business a better chance of survival. Once your budgeting figures are determined you are able to put in place forecasting and forward planning solutions that will help you have the cash flow to be able to cover any future expenses, if and when they arise.

Business budgeting and cash flow forecasting are also generally a pre-requisite by financial institutions for loan purposes which makes it all the more important for a new business starting up.

Surry Partners experienced and professional accountants can assist you with your budgeting and cash flow planning. We can work with you when planning either short or long term funding requirements of your business.

The Importance of Cash Flow Management

Whilst profit is of vital importance to the success of a business, the generation of a profit does not necessarily guarantee its survival. Business owners should be aware that more businesses fail because of lack of cash flow than because of profit loss. Cash Flow is a major factor in keeping a business running and many businesses have failed because of poor cash flow management practices. Your business might be making a profit, but if you run out of cash to pay your bills, your business can’t operate.

Cash flow refers to the movement of cash into and out of a business. Good cash flow management starts with good cash record keeping and is followed by understanding the general flow of money through your business and forecasting this cash flow for the future.

In simple terms, good cash flow management involves:

  • Recording all receipts and transactions to clarify what cash flow was required in any given period often over a 6-12 month period.
  • Using this information to form a picture of your predicted flow of funds for a particular period, usually for the year ahead.
  • Knowing the best sources for meeting additional cash needs when they arise and ensuring to keep good relationships with bankers and other creditors in case you need to seek financial assistance from them in the future.