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.
There are some quick options for cash management support when it’s needed in the short term.
You could consider a Prospa Small Business Loan for larger purchases or investments or a Prospa Business Line of Credit designed to provide ongoing access to funds (up to an approved limit) and put the business owner in control.
Borrow up to $300K with 10 minute application, fast decision and funding possible in 24 hours
Talk to real people. Business Lending Specialists who are focused on getting you what you need, sooner.
More than 26,000 small businesses have borrowed over $1.4 billion from Prospa so far. Join them.
Or call us at 1300 882 867. Our team is available to support you.
Cash management can seem complex. However there are simple strategies that small businesses can adopt to help improve their financial situation. While some strategies for managing cash flow might work for one business but may not be right for the next, so a combination of the following can be a great addition to the business’s cash flow risk management practices.
Help ease the stress on your cash flow and boost the balance of your deposit accounts with these simple cash management tips, perfect fundamentals for small businesses to add to their corporate process.
Effective cash management and planning can help ensure there’s enough of a cash balance on hand for a business to make purchases and take advantage of growth opportunities, it can assist the business to monitor cash flow requirements and pay bills, it helps the business plan for capital expenditure, and can put the business in a position to negotiate better finance terms. All these things are vital for a successful business.
There are plenty of online tools available to help with cash management. Here’s a free cash flow forecast spreadsheet to help you stay on top of your business cash flow and find out where your finances might need a boost. Download template here.
The information on this website is provided for general information only and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from financial, legal and taxation advisors. Although every effort has been made to verify the accuracy of the information, Prospa, its officers, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy, or omission from the information or any loss or damage suffered by any person directly or indirectly through relying on this information.