Improve your cash position through cash management
Having a clear picture of the financial workings of a business is one of the fundamentals contributing to a business’s success – and this is mainly achieved through effective cash management. Cash management involves disciplined monitoring, forecasting and planning over the longer term to allow the business to be prepared for any financial situation or opportunity that arises in the short term too.
The financial workings of a business can be divided simply into three areas that cover the inflows and outflows of cash from the business. These are accounts receivable, accounts payable and inventory, all of which fall under the overarching banner of cash management.
Central to cash management is the cash flow statement, a report that consists of a detailed overview of all the business’s cash flow situation. Whether you do it yourself, hire an accountant or bookkeeper, or employ a financial controller in-house – effective monitoring of available working capital (or cash management) can help a business to remain competitive, be financially flexible and be ready for any growth or investment opportunities.