Cashflow Statement for Small Business Owners

Cashflow Statement for Small Business Owners


Today you’re gonna learn all about a
Cashflow Statement and what it is and why you need to be creating one for your
business on a regular basis. Hi, my name is Paul Monax of AgileWealth.com where I help small business owners just like you understand the money in finances in your
business The Cashflow Statement is an accounting
report, but it’s got a couple of other names as
well Statement of Cashflows and Statement of Cash Because for some reason the accountants
just can’t seem to all agree on one name, but that’s justice semantics and accounting jargon so don’t let that confuse you or trip you up. The Cashflow Statement is really pretty
simple when you boil it down to the basics and it’s one of the three critical
financial statements that tell the story of your business
that you need to be keeping track of as the owner of your business. You can create
the Cashflow Statement yourself or you can have your bookkeeper or your
accountant create it for you. What you’re gonna see is a report of all
the transactions that have to do with cash flowing either into or out of your
business. It’s a report for given period of time
where it could be a whole year or a quarter Those are the most common but it could
also be a month for any other time period. When you’re first looking at a Cashflow
Statement and you’re keeping track of cash for the first time in your business i
recommend you do it monthly. The Cashflow Statement can take on many different forms, but I like this one the best. Beginning balance of the top a bunch of transactions and then an ending balance similar to
what your checking account statement looks like. Now, the balance sheet also has one more piece of data down here, the change in cash. It is one of the critical elements in the story of your business, and it’s one that you need to keep a close eye on. It’ll help you to monitor the long-term
health of your business and ensure that your business is going to be around for
the long term. The Cashflow Statement gives you a
full picture of what’s coming in to your business when you make a sale or you sell somebody else’s product and you
make a commission or what’s going out of your business
for salaries and expenses to build your
inventory and when you contribute money to your retirement
account all those are coming out of the cash of your business. When you add up all those numbers from the beginning through the end it gives you an ending balance.
The change in cash is the beginning balance minus the end balance and if this
number is going up that’s a good thing and if it’s going
down, then you’ve got something to take a look at and figure out what’s going on with
your business. It’s critical that you take a look at that,
because more businesses fail than probably any other reason from having decreasing cash flow and they
run out of cash in their business and their business goes bust because
they’ve got no more cash. If you’re looking for more information
on the Cashflow Statement and the other financial statements for business owners then head out to my website at AgileWealth.com/m12 or click on the link down below in the description it’ll take you to the same place. You can register for a whole package of
examples, templates and videos that i’ll send out to you right away that’ll help
you get a better education and a better understanding of the money and finances
in your business. thanks a lot for your time and have a prosperous day Oops, I guess I better slow down here. I didn’t even catch this one.

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