In recent years, virtual CFOs have taken their rightful place as a fixture in the contemporary business setting. Globalisation, modern technology and developments in business communications are all major contributors to this phenomenon.

If you are still unsure of the actual impact of virtual CFOs in your business, just take a look at how it affects your cash flow. Here are some of the ways by which virtual CFOs are extremely valuable to your business:

Managing your cash flow

You can rely on a virtual CFO to manage your cash flow effectively. By taking on the role of a cash manager, the virtual CFO takes charge of your business capital and makes sure that your money is growing. This includes determining the specific investment strategy and the asset classes to be considered, among others.

Creating the budget

For small business owners, prioritising the complexities of business financial planning by working out a budget is never easy. Seeking the help of a virtual CFO can help you create a budget and adjust your cash outflows based on your your inflows to keep your company from overspending.

Supervising your critical business numbers

Entrepreneurs who do the math on their own often find it too taxing to interpret their own financial statements. Hiring a virtual CFO can give you the assurance that your critical business numbers are interpreted accurately. More than anything else, it also keeps your business on its feet by establishing certain strategies that ensure a smooth and reliable cash flow.

Collecting debt

A strict debt collection policy is essential for keeping your cash flow in good condition. A virtual CFO can help guarantee that someone is keeping an eye on your receivables. By strictly implementing debt repayment strategies, the virtual CFO also ensures the timely collection of money that is owed to your business.

Exploring financing options

When your business finances slide, seeking financing options can significantly change your financial position. With that much-needed boost in your capital, you can have more resources to fund machineries or raw materials, which can add to your revenues in the long run. With their vast experience and understanding of financing options, a virtual CFO is indispensable in looking for the perfect financing option for your business.


The list of potential benefits for hiring virtual CFOs can be quite expansive, but truth be told, it all boils down to having experts who can work their magic on your cash flow.


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According to the D&B Global Business Failures Report , the number of small businesses going into liquidation has increased by 48 percent. If these findings are any indication, small business owners have to exert more business financial planning efforts to tighten their belt and mitigate business risks.

As we all know, risks cut across different industries. Fortunately, you can lessen these by predicting possible cash flow challenges before they become a major issue. This is exactly where a cash flow forecast comes in handy. But did you know that these forecasts can do more than just help you anticipate money management challenges? Here are more reasons why your business should prepare a cash flow forecast:

1. It helps you in budgeting.

A cash flow forecast gives you a clearer understanding of how much cash your business owns and how you can use these resources to fund your daily business operations. Managing your business finances through a cash flow forecast also helps you map out the wise use of your money.

2. It showcases your financial viability.

A cash flow forecast is valuable if you are considering a sale of your business or admitting business partners. Since it asserts the financial viability of your business, a cash flow forecast is extremely valuable in proving the worth of your business to your would-be shareholders or purchaser.

3. It measures business performance.

Is your business doing well? A cash flow forecast is vital in measuring business performance. Since these financial statements provide accurate figures for your cash inflows and outflows, you can use it to ensure improvements in business performance.

4. It improves goal-setting initiatives.

At this point, can you name the specific goals that you want your business to focus on? Failing to set your business goals may compromise your business direction. The ideal approach: Use a cash flow forecast to set your targets and have better chances of hitting those targets as accurately as possible.

5. It simplifies your financing options.

When businesses struggle with their cash flow, availing loans becomes essential in keeping your business capital on track. A cash flow forecast helps you determine a) if there is a need for loans as well as b) the frequency of loan repayment.

To say that a cash flow forecast is extremely valuable for your business is an understatement. In a nutshell, you can prepare these financial statements on a monthly or quarterly basis – depending on the phase of your business and its level of stability. The more volatile your business performance is, the more frequent your cash flow forecasts should be.

By closely monitoring the movement of money in your business through a cash flow forecast, you will make more informed business decisions.

Can’t get enough of cash management tips for your business? Click on the button below to download a copy of our FREE cash flow management eBook.

As you might have figured out by now, you don’t need formal business education to put up your own business. Note, though, that keeping tabs on your business finances is an entirely different matter. If you want your business to run as smoothly as possible, you need to know all that there is to business financial planning. You can start by managing your cash flow. 

At this point, would you say that you have a clear idea on how to ensure the financial stability of your business? Take a look at these tips to get more ideas:

1. Determine your cash flow projections

Use facts to help you make wise and objective decisions about your business finances. This is where a cash flow forecast comes in handy. A cash flow forecast documents the movement of money in your business, empowering you to have a clearer understanding of the ideal business financial planning initiative for your company. Through this document, it will be easier for you to make plans about using your money in the most efficient way possible.

2. Control your business expenses

Keep your business costs to a minimum. Review your business expenses and determine which among these can be reduced or taken out from the budget. Attempting to cut down on fixed costs may be a great challenge but most probably, you’ll get more luck with variable expenses. Make sure the expenses you are cutting down on will not affect the quality of your products or services.  

3. Make your money work for you

Generating more income for your business does not just equate to increasing your marketing efforts. Aside from ensuring that your products and services are being patronised by your customers, putting your money in asset classes that yield a profitable ROI is also ideal. Here’s a great idea: why not try investing in stocks and bonds as part of your business financial planning initiatives? This way, your money earns more value instead of just remaining stagnant.

4. Find ways to increase cash flow

A steady and reliable cash flow is the lifeblood of your business, Work out business finance initiatives to generate more cash for your business. You can consider strengthening your marketing strategies, finding new suppliers or collaborating with investors to increase your cash flow. You can also discuss your options with finance brokering companies to get enough funds for your business expansion.

What does it take to keep your business running smoothly? There are a lot of factors that come into play where the success of your business is concerned. Rest assured, though, that ensuring a healthy cash flow gets you one step ahead.

Need help in improving your cash flow? Click here for a free consultation with our advisers.