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Your Very Financial Planner Intelligence

Cash Flow Calendar

The Ultimate Guide to Cash Flow Analysis

For a small business owner, performing a cash flow analysis regularly is essential for success. After all, running short of cash is one of the most common causes of small business failure. The good news: Regular analysis of your cash flow can help you avoid this pitfall and manage your business more effectively.


What is a cash flow analysis?

You perform a cash flow analysis using a cash flow statement. This is a financial statement that records how money flows into and out of your business during a specific pre-determined period of time.


How do I conduct a cash flow analysis?

It’s a good idea to perform a cash flow analysis at least once a month, but you can certainly do so more often. If you are in a highly volatile industry or experiencing cash issues, you may want to do a cash flow analysis weekly or even daily. Project your cash flow out for whatever time frame you choose. Four to six weeks is a good starting point.


If you are using Mr. Accounting, our Cash Flow Calendar allows you to view your cash in and out monthly. This intelligent application also allows you to track your customer and supplier due in an easier and more effective way.


From here, you can forecast the monthly cash balance of your company and see whether your company is short of cash or having too much cash in hand. With this you can perform business planning in order to ensure that your business can run smoothly.

Cash Flow Calendar as one of the applications in Mr. Accounting Version 10.

You can track your cash in/ out as well as your customer/ supplier due here.

You can see your total cash in and out as well as total net cash flow per month in this calendar.

You can see your supplier and customer due per month in this calendar

Once I’ve conducted a cash flow analysis, what should I do with the information?

The more frequently you conduct a cash flow analysis, and the longer you do so, the more you’ll learn from it, as you’ll begin to see patterns. For example, you might notice that your cash flow is positive most of the time, but regularly becomes negative during the third week of every month. Unfortunately, you also notice that most of your business’s bills are due the fourth week of the month. This means you’re often caught short of cash, which is causing late payments and hurting your business credit rating and reputation with suppliers.


By examining your cash flow statement, you can figure out possible ways to remedy the problem. To cover the shortfall, you can either cut your costs or increase your income. Ideas for accomplishing these might include:

  • Adjust staffing during the month to decrease payroll

  • Buy less inventory if you’re adequately stocked

  • Paying vendors later (still staying within your due dates, of course)

  • Email a special offer to bring in more customers and increase sales

  • Reach out to late-paying customers to speed up payments

  • Raising prices

  • Finding a source of short-term working capital to get you back in the black

Creating a cash flow analysis might seem intimidating at first, but once you’ve done it a few times, you’ll wonder how you ever ran your business without it.



--- Credit: Rieva Lesonsky, Fundera

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