Cash flow is paramount in business success. Understanding your different service or product lines, revenue they produce, and matching expenses to these items can assist in determining profitability and productivity. As year-end approaches, businesses should take this time to not only reconcile transactions within their books for year-end reporting, but also prepare a budget and cash flow projections to set up next year for success. The budgeting process should include projections in income, fixed and variable expenses, as well as any capital purchases that will be needed for that year. Many accounting software providers then allow this budgeted information to be loaded into their system allowing clients to compare budget to actual performance throughout the year.
If you have any questions regarding budgeting, please do not hesitate to reach out.