Have you ever thought ……where’s my money?
Your accountant tells you that you have made a profit but there is no money in your bank account………….WTF!
Here are a few reasons why this may be the case:
1) You have made loan and interest repayments.
2) You have bought some new equipment.
3) You have bought some new stock.
4) You have paid your bills quickly (like you wish your clients would).
5) You haven’t been paid for work you have done (if this is the case we need to fix this quickly).
6) You have paid yourself some drawings.
7) You have had to pay some tax, such as GST or income tax.
There’s a big difference between turnover, profit and cashflow. There’s a saying turnover is vanity, profit is sanity and cashflow is king. Cashflow is king, because without it your business will not survive. AND cashflow is one of the areas many business owners get caught out with.
Having a cashflow statement is a great way of understanding how the money "flows" in and out of your business.
Many business owners think it’s harder than what it is to set one up, we help our clients do it all the time. So if you’d like a hand, let me know and I will do my best to help.