Cash flow

Maximizing cash flow

After you analyze the current cash situation and develop a forecast, you can focus on identifying the best ways to help clients adjust how they manage their cash flow. They’ll likely need to implement a combination of approaches to both increase money coming in and decrease what they spend. As you did with the forecasting, use the data from key QuickBooks reports to come up with recommended courses of action.

Increase money in

Speeding up existing revenue streams or finding new ones can give clients an infusion of cash that they can use immediately to continue running the business.

Accelerate accounts receivable

QuickBooks has several reports to help you quickly identify which customers have outstanding balances and who owes the most. You and your clients can then choose how to manage these accounts to increase cash on hand.

To see which customers owe the most, use the Open Invoices report.

For a detailed breakdown of how much each customer owes and the due dates, check the Customer balance detail report.

Explore relief funding options

There are many options available for eligible businesses and organizations to apply for loans, grants, and other funds. The Intuit COVID-19 Resource Centre is a free resource to help you and your clients protect their businesses and their employees. You can also help your clients navigate which programs they qualify for on the Canadian Government’s Support for Small Business Page. The two largest federal relief programs are the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Business Account (CEBA).

While accounting professionals can’t complete and process applications on behalf of their clients, we expect you’ll play a key role in assisting and advising your clients who apply with their financial institutions.

Other ideas

You can work with your clients to implement creative ways to adjust their business models and increase their revenue options. Here are some ideas to get started:

Reduce money out

The less money clients spend, the longer their cash reserves will last. Several strategies can help clients manage their expenditures and have an immediate effect on their cash flow. If your clients use autopay for their bills, suggest that they turn it off until you prioritize the spending.

Lower or defer payments

Encourage clients to work with suppliers, lenders, and government agencies to explore options for deferring payments or restructuring terms and rates. Use report data from QuickBooks to help your clients prioritize who to contact.

Get tips on communicating with suppliers

Reduce fixed expenses

Large monthly expenses are the easiest to identify. Lowering them can have a substantial impact on available cash for the business.

Check current bill status

It may be most helpful to start with the bills that are already due. Suppliers may be flexible on timing or be able to offer payment plans.

For a snapshot of due and overdue bills, use the Unpaid bills report.

To see how much your client owes each of their suppliers, use the Expenses by supplier summary report.

Explore options to defer loans and taxes

To identify lenders or other note-holders to contact about deferring loan payments, use the Transaction detail by account report.

For a list of the client’s tax agencies, use the Taxable sales detail report.

To calculate how much payroll tax the client pays, use the Total payroll cost report.

Cut back discretionary spending

There’s a wide range of expenses that clients can control. Identifying items that aren’t necessary—either in the short term or at all—can alleviate some of the stress around negatively affecting cash flow. If your clients use autopay for their bills, suggest that they turn it off until you prioritize the spending.

Recurring expenses

Clients likely have monthly or quarterly expenditures that aren’t necessary in the short term. They may be able to cancel or suspend supply orders, marketing subscriptions, or memberships. You can help clients find potential savings by identifying recurring transaction patterns. To see all transactions for a specific time period, grouped by supplier, run a Transaction list by supplier report.

Marketing and advertising

Marketing budgets typically have some flexibility, and clients should be able to adjust them for the next few months. To see average spending, use the Transaction detail by account report.

Meals and entertainment

Suggest that clients minimize spending in this area for the next few months. Use the Transaction detail by account report to see average meal expenses.

 Next: Staying a step ahead>>


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