A Time for Cash Budgets
The official figures suggest we are not in a recession. However, commentators, economists and your brother and his next door neighbor are talking about a recession.
OK, so we can debate all day whether it’s a recession — or not. But whether we’re “teetering on the brink of recession” or in a recession, how about being proactive?
The CPA Trendlines blog polled some CPA pros for strategies to beat a recession, in the article “Recession Tips from the Pros.” One of those strategies hit home particularly well, from CPA Brian Brown, who said,
“CASH FLOW, CASH FLOW, CASH FLOW!!! Track it, analyze it and project it. Without it, your business will come to a screeching halt very fast. The best laid business plans and products are worthless if you can’t pay employees and vendors in order to carryout the basic operations of the company.”
Keeping the cash flowing is always important, but becomes doubly so during tight economic times. Why? Because that’s when payables tend to get even slower. Everyone starts watching their own house, and stretching out how long it takes to pay.
All the more reason to pay close attention to your cash situation. If you have done a yearly or quarterly cash budget, make sure you are comparing it to your actual cash situation each month, or maybe twice a month. That budget isn’t any good unless you use it. If you don’t do a cash budget at all, maybe it’s time to start.
For resources on setting up a cash budget, visit:
Prepare a Cash Budget
How to Prepare a Cash Budget
And remember that if your cash situation falls short, contact Facteon for solutions to accelerate payment of your invoices and quickly increase your cash flow.
