cash flow – the life blood of business


Almost every business owner has been told that they should keep cash flow forecasts but hardly anyone ever does.

So what’s the result? Well, as we all know, many businesses just operate from cash flow crisis to crisis. Perhaps even yours?

Operating your business without a cash flow forecast is a bit like driving your car at night without headlights. The headlights won’t guarantee that you won’t have a crash, but they do dramatically improve your chances of avoiding one.

There are two main excuses why most people don’t do cash flow forecasts:



“cash flow forecasts are impossible because I can’t predict future sales”

Well, this is kind of true, predicting future sales can be very tricky. But that actually misses the whole point of doing a cash flow forecast. Amazingly, the point of doing a cash flow forecast is not to make an accurate prediction about the future. Don’t even try to be accurate, it’s almost impossible.

The purpose of the forecast is to see how your cash flow will behave under a range of conditions. If you do it properly, your forecast will show you what your cash flow will look like if your sales good, average, poor or catastrophic. Your cash flow forecast is like your headlights. It looks down the road, and gives you early warning of problems that may arise and it gives you the opportunity to make plans ahead of time.


“Forecasting is complex, technical and time-consuming.”

It doesn’t really need to be like this. No doubt, there is a certain amount of work involved in creating the cash flow model for your business in the first place. But if it’s done properly, keeping your forecast up to date should be a breeze.

And to make things even easier, today’s cloud accounting systems like Xero have a range of tools designed to build cash flow forecasts with a simple structure process.

“Cash flow forecasts tell you what might happen and give you the chance to find solutions to problems before they happen.”


If you’ve never built a cash flow model before it’s a great idea to get professional help. Certus Group Accountants have built hundreds of cash flow models for all kinds of businesses. We know the shortcuts and the tools you need to make it happen. It needn’t be a lengthy or expensive process but it might be the best thing you’ll ever do for your own peace of mind.

Give us a call today and let’s talk about getting your cash flow under control.