The one thing that people in business worry most about is usually cash flow.
The trouble with cash flow is that it doesn’t match your profit i.e. you can make lots of profit on paper but it doesn’t show up in your bank accounts. This is to do with timing differences of when you invoice your customers and when you get paid.
Often, these timing differences can be the difference between success or failure of your business.
Coupled with customers not paying or taking too long to pay are your big expenses – VAT and corporation tax, which aren’t always around but when they hit, they hit you for 6.
The best way of getting on top of your cash flow is to track it. This isn’t particularly exciting but once you are on it, it does give you a tremendous sense of power.
To help you, I’ve designed a VERY simple cash flow, if you’d like to see a copy – email me at russell@rsaccountancy.co.uk
