JOHANNESBURG – Interestingly, cash flow management is a major concern for every small business. Though you’re playing smart with your invoice processing accounting and accounts receivable management, cash flow problems can cripple in your business whether you own a small or large business. Small businesses are more vulnerable to cash flow problems.
However, it doesn’t mean you cannot control your cash flow problems, not entirely, but up to a little extent by forecasting cash flow every year. So, let’s discuss cash flow forecast in detail:
What is a cash flow forecast?
A cash flow forecast predicts how much cash will come in and go out of your business in the financial year. This means it involves all your predictable revenues and expenses for that particular period. You can do cash flow forecast yearly or monthly or weekly as well.
The process begins by creating an account in which you can add the money that you expect it to be the balance amount. You may consider these funds for revenues, sales, receipts, etc. In the same way, you can subtract some amount from balance, which is the money outflow of your cash flow. You may call these as funds costs, expenses, payments, etc.