Cashflow

Cashflow
There is a high focus on a Business Turnover and Profit regardless of the nature of trade or which area the business operates
The 2 key components of measuring the success of a business is the Turnover and Profit as only if a business is profitable would it be in a position to run smoothly and efficiently whilst paying for the business overheads and liabilities.
However, it is important that the business remains solvent at all times and one of the only ways this would be possible is to be in a position to receive money on time from the customers/clients and pay suppliers/other liabilities on time.
Now this is where the issue arises when it comes to cashflow usually around Debtors/Accounts Receivables.
If a business has high level of debtors (Money being owed by customers) and for a prolonged period this has a massive impact on any business and what makes it even more challenging and difficult when despite not having received the money yet, there will be Corporation Tax Liability on that or an accumulated number of invoices subject to the business being profitable overall.
There are certain trades such as Logistics where there is a 45 days period before the customers pay but then the opposite affect is true where the business has 45 days to pay the supplier.
There could also be huge issues where the level Creditors/Accounts Payables increasing and not paying suppliers on time or within the agreed credit period and this could lead the business to becoming insolvent and the risk that a Business owner could be personally liable subject to the terms of the agreement
A simple spreadsheet can do the job to monitor a businesses cashflow or it would be advisable to consider any of the cloud softwares 👇 to update in real time
Xero
Sage
Freeagent
Quickbooks
Quickfile
Freshbooks
VT Cashbook
Capium
There are other softwares readily available for Cashflow purpose but for small and medium businesses using any of the 👆 cloud platform softwares to monitor would be fine with some great features available such 👇
Auto-Bank Feed
Integrated Apps
Detailed Reports
If you would like further advise or assistance, please feel free to reach out and we can assist in setting the ✔ systems in place specifically tailored for your business
Tel: 01212852534
Web: www.secureaccountsltd.co.uk
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