2019 is here and with January coming to an end, it is the last moment to plan your finances for the year. Review the company’s existing financial situation to determine where your business requires improvements for the running year and many years to come. If you don’t have a plan yet, take a look at 3 of our suggestions, however, if you do, read through the list and tick, if you’ve covered them all.
To plan a realistic budget, you need to evaluate your current financials. The more credible the data, the more likely you would be able to keep up with it. This is where your business and its accounting system go hand in hand- not only it shows the current situation but also suggests improvements. Based on previous experience, allow room for unexpected expenses. Additionally, you can go the extra mile and create an another forecast to predict the best and worst case scenarios. Be ready for the worst but aim for the best.
Have late payments become a pattern? A healthy cash flow is the lifeblood of each business, therefore, you must find the reasons of the hang up. Cash flow management is crucial for business growth (you may find this article useful), however, keep in mind, that January might be slower than usual because of the employee absence. That’s something you can estimate and add in the unexpected expenses.
Plan ahead for tax bills: VAT bills are due every three months and corporation tax is due once a year. Not planning ahead might resort into taking business loans, which might later have a negative impact on the budget and slow down your business growth.
No matter how many steps you take to manage your finances, it is not going to matter, if you won’t follow up on them. By often reviewing your budget, you will be able to notice if there are any disruptions and tackle these issues easier. Sticking to your budget will also enhance your business growth and flexibility. Most importantly, you will be able to define if your company is going in the right direction and keep building your business for a smooth 2019.
*This article was inspired by sage.com article:”Business finance management”
**Thank you pexels.com for the photos.