What is a Business Plan?

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A business plan is converting your business idea into a written document which should include:

1. background of the business, introduction of the business idea and why do you want to do business;
2. a description of the products you want to sell or services you want to offer;
3. the customers you wish to sell your products or provide your service to;
4. how you will advertise your business to attract customers; and
5. your financing budget to get your business started.

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Why Should I Prepare a Business Plan?

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A Business Plan helps you to layout the goals and objectives that needs to be achieved to get your business up and running. This Plan will also present a snapshot of the future of your business. The business plan will also help you to:

• Maintain focus in achieving your business goals such as sales target, keeping track of expenses and payments etc;
• Provide a guide for you and your staff in growing the business; and
• Obtaining funds from Banks or other financing organisations.

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Business Plan Template

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Click HERE for Business Plan Template

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What is a Cash Flow Statement?

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A Cash Flow Statement is a report that summarises the money or cash your business receives and pays out over a period time. It should reflect all of your likely cash revenue sources (like sales or other payments from customers) and compare these against your likely business expenses (like supplier payments, premises rental and tax payments).

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Why Should I Prepare a Cash Flow Statement?

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There are many reasons to prepare a cash flow statement, which includes:

• tells you how much cash you have;
• used for budgeting and forecasting purposes. For example, you will know how much cash you have to meet commitments such has payments to creditors, loan repayments, wages, taxes etc;
• helps in investment or capital decisions; such as buying a vehicle for your business;
• requirement for obtaining a loan from banks and financial institutions.

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How Often is the Cash Flow Statement Prepared?

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This can be prepared on a weekly, monthly or annual basis. Preparing cash flow statement on a monthly basis is most common interval.

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How Do I Complete My Cash Flow Forecast?

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A Cash Flow Forecast is made up of three key sections: 1. Revenue You add all of these sources together to figure out your total cash revenue. You can refer to the sources documents (such as cash register, receipts books/issued, bank statements), to figure out your total cash revenue. 2. Expenses This section is where you list any of the expenses your business incurs, like your premises rental, staff wages, tax, supplier costs, marketing and promotional expenses etc. Don’t forget to include things like your own salary or Start Up Loan repayments. You can refer to these sources documents (such as Cheque book, receipts received and bank statements), to figure out your total cash expenses. 3. Net Cash Flow
This final section is the difference between your total revenue and your total expenses.
e.g. “total cash income – total cash expenses = Net cash flow” If this figure is negative, it means that you are anticipating your expenses will be greater than your revenue in that period; conversely, if the figure is positive, it means you are anticipating your revenue to be greater than your expenses and have a positive cash at bank balance.

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Cash Flow Statement And Forecasted Cash Flow Template

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Click HERE for Cash Flow Statement Template Click HERE for Forecasted Cash Flow Template

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