We all know that cash flow is such an essential ingredient to the survival and success of any business. If you ever encounter cash flow problems at some stage of your business’s life, it could be a serious obstacle to your progress.
Which is why it always pays to keep a close eye on what your cash flow is doing and ensure that you’re in the position to take steps to rectify any problems before things get out of hand.
This Financial Hygiene Dashboard gives you an overview of your cash transactions. At a glance, you’re able to see how much cash is sitting in your bank account and what you’re due to pay out to HMRC for VAT.
You’re also able to view how much cash you’ve received into your bank account verses how much you’ve paid out. As a business owner, you need to monitor your cash movement closely. For example, if there is more cash going out of your bank account than coming in, alarm bells would be ringing as this could lead to cash flow issues!
It’s also essential that you monitor your Debtors and Creditors Days. For example, let’s say your business currently receives payment from debtors every 47 days, however you’re only paying creditors every 168 days. You’ll know from reviewing the Creditors Age Analysis Dashboard that there’s GBP420k sitting in the Older Than 120 Days column—which you’re currently waiting for a credit note on, therefore this should reduce your Creditors Days accordingly to a more realistic number.
It’s also always a good idea as a business owner to track the amounts that are due from your debtors, as well as the amounts that are owed to your creditors—as these directly affect your cash flow. Looking at your creditors’ balance, you’ll know that there is GBP420k that is due to be credit noted as you returned the stock. This will bring your creditors balance down to GBP700k—which is more like what you were expecting.
You’re also provided with a Cash Projection for your business in this Dashboard. This is a quick cash flow projection that tells you your bank balance for today (1), how much cash you owe HMRC for VAT (2), how much you’re due to receive from my Debtors (3), and how much you owe your creditors (4).
To learn more about this report and how to make best make use of it, watch this short learning video.
Get more insights into your information!
Did you know that we’ve introduced FIVE interactive dashboard reports just like this to Sage Intelligence for Accounting? Click on the report below that you want to find out more information on, and discover the incredible impact it will have on your business:
- Understand your customers with a Sales Trend Analysis report.
- Get a picture of your business’s health with the Financial Hygiene Dashboard.
- Collect your cash with the Analysis of Aged Debtors report.
- Track your creditors with the Analysis of Aged Creditors report.
- Know your numbers with the Business Snapshot Dashboard.
Check out how these interactive dashboards can change the way you see your business by logging in to your Sage Accounting solution and trying them out now!