Whether you’re planning on hiring new staff members, expanding your marketing, or are looking at how you can offer raises at your Fuquay-Varina small business, you have to know your cash flow first. Cash flow management and monitoring gives you a clear, accurate estimation of how much money you have on hand. Just as importantly, it provides projections of shifts and changes you can expect so you have a solid understanding of how much cash you’ll have at any given time throughout your fiscal year.
At C.E. Thorn, CPA, PLLC, we can advise you with cash flow management for small business as part of the financial services in Fuquay-Varina we offer. With our experienced accountants keeping you notified and up-to-date with changes in the amount of money coming in or going out of your business, you can have the clarity and confidence necessary to control your business’s financial standing. Always knowing whether you have a positive cash flow with income coming in or a negative flow in which you have excess expenditures, empowers you to make improved decisions and plan for your future.
Many small business owners confuse profit with cash flow, and it’s important to note that they are very different financial aspects. Your profit balances your income after all expenses and taxes are removed. On the other hand your cash flow is an ongoing look at how cash is moving in and out of your business and provides a clear look at trends in your incoming and outgoing finances.
Cash flow management provides necessary answers to questions such as:
It’s clear how important it is for your business that you have the answers to these questions. Knowing these figures is essential when you’re looking into a business loan or credit, plus, it can help you look ahead to potential cash-related problems.
Because your business should always have money coming in or going out as you collect revenue or pay for services, you will see peaks and valleys in your cash flow. Knowing in advance how your Fuquay-Varina small business will see these peaks and valleys prevents you from hitting a time of limited cash availability.
With our cash flow monitoring, we can help you with the analysis necessary to determine when or why you may experience increased outgoing expenses or a decrease in income, whether it’s due to seasonal patterns, local events, or other factors. Our experienced accounting team can help you recognize where you may face obstacles and recognize problems so you can fix them.
While many Fuquay-Varina business owners feel overwhelmed at analyzing cash flow, look at these four areas, as these are often the biggest locations for expenses.
At C.E. Thorn, CPA, PLLC, we can help you create a realistic budget for your business and manage your cash flow by developing a cash flow strategy and reviewing and revising it as needed.