Identify actions to relieve cash flow problems

1
Aims For Today

• Identify actions to relieve cash flow problems
• Analyse the use of cash flow forecasts

2
Cash Flow Quick Quiz

• A business can exist for a while without but not
  without?

3
Cash Flow Quick Quiz

• Cash flow is?
• Profit is?

4
Cash Flow Quick Quiz

• A business may review its current cash flow
  position by?

5
Cash Flow Quick Quiz

• A cash flow forecast allows a business to..?

6
McManuss Magnificent Pies
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McManuss Magnificent Pies
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McManuss Magnificent Pies

• Issues
• Negative cash flow in September and October
• Actions
• ??

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Solving cash flow problems
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Solving cash flow problems
Delay outflow
Speed up inflow
Cash flow solutions
Cut expenditure
Additional funds
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Cash flow issues

• Should Treasured Memories take the commemorative
  plate order?

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Reliability of cash flow forecasts

• Only as good as the estimates they are built upon
  timings amounts!
• Business need to build in safety margins
• Spreadsheets are useful!
• Overtrading expansion without sufficient
  financial backing problems with using working
  capital

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Issues for Analysis

• Validity of figures who did the figures? Are
  they reliable / unbiased?
• What the figures show
• Possible solutions to any problems
• Advantages and disadvantages of any possible
  solutions
• Taking full account of the business situation
  (e.g. foreign currency payments)

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Homework

• P126 Revision Questions 1 6
• FOR NEXT LESSON