07Cash Flow Management
All accountants and bank managers (although I should probably use their preferred title of ‘relationship managers’ these days) love cash flow forecasts. The reason they like them so much is that they know cash flow forecasts are the most accurate way to predict the future financial health of the business, both in the short and medium term. Accountants know, from their experience in dealing with insolvency, that most businesses fail when they simply run out of cash. The popular misconception is that businesses are forced to close because they failed to make a profit or to find sufficient customers. The truth is that the majority are forced into liquidation because they could no longer meet their financial obligations when ...
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