Cash flow forecasting：现金流预测.ppt

Cash flow forecasting What is Cash? Cash is the physical asset in your pockets! Profit is a figure indicating how much a company has left after costs have been taken away – does not always mean you have paid money out/or collected it in. Working Lunch Video Questions What is the legislation has been introduced by the Government supposed to do? What are the normal credit arrangements? What are the new rules on payments? What are the problems with the new rules? Cash flow forecasting Cash flow is the inflows and outflows of cash of a business A cash flow forecast is a forecast of inflows and outflows over time The cash flow forecast therefore shows how much cash a business has at its disposal at any time within the period of the forecast The Cash Flow Idea Cash Flow Forecasting University Example Cash flow forecasting Cash is used to pay items of expenditure (including capital purchases, loan repayments etc If the cash flow forecast indicates that there will be a short-fall of cash at any time, the business can make arrangements to obtain additional inflows such as an overdraft, loan or other appropriate source of finance Cash flow forecasting (the difficult bit!) In a cash flow forecast items are recorded in the months the money will be actually spent or received, and not in the month the goods or services will be sold or received; therefore goods sold in January on one month’s trade credit will be recorded in February, when payment for the goods is expected Birchfield Cash Flow Birchfield Interactive Cash Flow Drag and Drop Drag and Drop Activity Benefits of cash flow forecasting The business can foresee any periods in which there will be a short-fall in cash flow and make advance arrangements with its bank or other source of finance to cover the shortfall Banks are more likely to accommodate a request for an overdraft or loan if the business can show good cash flow management Cash flow forecasting facilitates better management and use of financial resources