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Better financial control

Business people recognise that generating healthy cash flow requires a substantial amount of control of your finances. This is achieved by:

The starting point is to set up a system that enables you to generate accurate reports as quickly as possible – certainly no later than ten days after the month closes.

To be fully in control, you need information on what is happening to your business
now, not what happened weeks or months ago. This can be achieved by setting up a system of weekly or even daily updates of key areas such as sales, debtors, cash position, trade creditors, and employment figures.

One of the most valuable instruments of financial control is drawing regular comparisons between projections and results. Not only does this keep you up-to date on how your business is doing, it also reveals how realistic your expectations are and how in touch you are with the essentials of your business. For best results, you should draw up projections for a six-week period and then set new projections at the four-week point.