Dan Sova, CTO of Float Accounting, Gives 4 Cashflow Management Steps You Can Implement To Improve Your Business’ Cash Flow.
Manage business cashflow with these 4 easy steps:
[00:00] Let’s talk about four more steps you can take right now to better manage your business’s cash flow.
If you’re a business owner, you know that cash flow is the lifeblood of your business. Poor cash flow management can lead to missed bills, late fees, a poor credit rating, issues with suppliers and even insolvency.
Having effective cash flow management and visibility into your current and projected cash position will help you make sure this never happens to you. Luckily, there are some fantastic options available to help you make managing your cash flow easier.
Manage business cashflow; here are four steps you can take right now:
1) Get your business on to Xero
[00:31] If you’re not already on Xero and using manual accounting methods or one of Xero’s competitors, you might be a sucker for punishment ?.
Jokes aside, Xero is a popular and our preferred cloud-based accounting software that we use to manage tax, accounting, bookkeeping, and payroll for ourselves and our clients.
Xero integrates with a number of cashflow apps and should form the basis of your cashflow app stack. Cashflow management is only as accurate as the data that underlies it, which is why it’s so important to get your business onto cloud accounting software like Xero.
Xero can provide you with real-time, accurate data, better than most other options available to you.
Xero offers automatic bank feeds that import all of your business bank transactions directly into the app, ready for reconciliation against your correct accounts.
2) Bring in your transaction data, bills and receipts into Xero using Hubdoc
[01:13] Hubdoc lets you easily import bills, receipts and documents into Xero. The great thing about hub doc is that it extracts key data right out of your uploaded files. It then syncs that data against your bank feeds straight into Xero, where it’s ready to be reconciled. This means no more manual entry of your invoices into your accounting system.
3) Make sure your bookkeeper is reconciling regularly
[01:37] Once you’ve got bank transactions, bills, and receipts auto-syncing into Xero, all you need is a great bookkeeper to make sure those reconciliations happen accurately and on a regular basis.
The more often and the more accurately this is done, the more accurate your cash flow management reporting and forecasting will be.
4) Integrate a cashflow management reporting and forecasting app into Xero
[01:58] If you followed steps one through three, you now have near real-time data reconciliation in Xero.
This means you can now see live snapshots of your current position and easily build out cash flow forecasts using Xero’s basic built-in cash flow reporting. Alternatively, you can use a high-end third-party management reporting and forecasting app.
And because Xero has a lot of third-party integrations, you can pull that data into these apps to provide you with real-time analytics of your cash flow.
These apps can help you manage your cash flow, understand your key financial metrics and make better business decisions. Options include Futrli, Spotlight Reporting and our own in-house recommended tool, Fathom.
Side note, business clients on our CORE accounting package get access to their own personalised Fathom dashboard. We set up and configure this for you when you sign up, plus you get a quarterly review and action planning meeting so you can implement steps to achieve your financial objectives.
Also, Float Accounting is a Xero Partner and certified cloud app integrator, so if you’d like help with any of these steps, reach out to us.The information contained in this publication is for general information purposes only, and does not take into consideration your individual circumstances. You should obtain personalised professional advice before acting upon any information contained herein. To the maximum extent permitted by law, we accept no responsibility for any loss incurred by any person directly or indirectly due to any action taken or refrained from as a consequence of the contents of this publication.