Staff Writer

While an income statement can present a true picture of the operating results of your business, understanding what is happening with your cash flow is also critical and can help you with your day-to-day operations. Managing your business without adequate cash flow to meet operating needs and to take advantage of marketplace opportunities can hinder success.

There are many benefits to maintaining an effective cash flow statement:

  • You will better understand the day-to-day financial dynamics of your business.
  • You will better understand the long-term financial dynamics of your business.
  • You can anticipate upcoming needs.
  • Preparing one may well help you identify some ways to improve your cash flow.
  • Your lender will most likely require one.
  • You can have some peace of mind.

Most businesses prepare cash flow statements at least annually, and many prepare one each quarter. If you would like to get started with this best practice, but don’t have a statement to model yours after, accounting software provider QuickBooks offers a cash flow statement template that can be downloaded and used by any type of business. It’s available here at no cost. The Excel template should be customized to include the specific types of cash flow activities that apply to your company. You might want to start by preparing a statement for the prior year to become familiar with the process and then start doing quarterly projections of your cash flow. 

This news is provided as a service to you by Marlin Business Services Corp., a nationwide leader in commercial lending solutions for the U.S. small business sector. Marlin’s equipment financing and loan programs are available directly and through third-party vendor programs, including manufacturers, distributors, independent dealers and brokers, to deliver financing and working capital that help build your success.