This document provides information about a workshop on cash flow management for businesses. It discusses Nicky from DMGNZ, a business support company, and her qualifications and experience. The document outlines six key areas of financial fitness: debtor and creditor management processes, budgeting systems, monthly reporting, cash flow management, and working with accountants and banks. It provides details on setting up systems for debtors and creditors, examples of monthly reports, the importance of cash flow, and a four-step cash flow management process including forecasting, tracking daily cash flow, updating forecasts, and using the forecasts to inform business decisions. An early bird special is offered for an upcoming six-month financial fitness program.

1. Lunchbox Learning
Workshop
Financially Fit Series
Cash-Flow for Management
December 2012

2. DMGNZ
Our Mission
To Support New Zealand Businesses to
Develop, Manage and Grow.
We specialise in…
Working as an Extension of our Clients Team!!!

3. DMGNZ
We started as an Outsourced Credit Control
Company
Now offer a full range of back office services:
• Debtor Management
• Book-keeping
• Payroll Services
• Business Support
• Strategic Services
• Training

4. Nicky @ DMGNZ
Been in business for 12+ years.
• I am not an Accountant.
– Work with Accountants.
• A QBE – Qualified by Experience
• Take a Holistic Approach.
• Problem Solver.
• I Love Training!!!

5. Financial Fitness for 2013
There are 6 areas I feel are essential to healthy
financial fitness within a business:
• Debtor Management Processes.
• Creditor Management Processes.
• Budgeting Systems.
• Monthly Reporting.
• Cash-Flow Management.
• Working with your Accountant and
Bank Manager.

6. Debtor Management Systems
• Implementing systems for before you give credit
– Account opening forms
– Credit checks
– Setting the parameters for the ongoing relationship
• Following through when making the sale
– Sending invoices & statements
– PPSR registrations for goods valued over $2000
• Robust Credit Control System
– Reconcile bank account daily
– Make the phone call
– Follow through on promises …

7. Creditor Management Systems
• Keep records of all transactions:
– Receipts.
– Invoices.
– Bank statements.
• Reconcile supplier statements & invoices.
• Keep all records in a logical order:
– So it works for you!
• Use one system to collate all information:
– Eg: MYOB, Xero, Cash book…
• Communicate with suppliers where
necessary.

8. Budgeting Systems
• Your budget is your financial plan for the
year ahead!
• Align it with your IRD financial year/end of
year accounts.
• Be realistic…
• Review it regularly
• Adjust for changes in your trading needs.

9. Monthly Reporting
Set up regular monthly reporting to analysis your businesses performance…
• Minimum Reports
– Profit and Loss
– Aged Receivables & Payables
– Budget vs Actual Analysis
• Additional Recommendations
– Balance Sheet
– Item Transactions
– Client Transactions
• Accounting Ratios
– Current Ratio
– Quick Asset Ratio
– Gross &/or Net Profit to Sales Ratio
– Return on Owner’s Equity
– Stock Turnover
– Average Debtor &/or Creditor Days

10. Cash-Flow Management!!!
Cash Flow is King!
How often do you manage your cash flow…
• Monthly?
• Daily?
• As Required?
• Never????

11. Cash-Flow Management!!!
4 Step Process:
• Monthly Cash-flow Forecast.
• Create a Template for the Daily Cash-flow.
• Up-date Daily.
• Analysis and Adjust.

12. Monthly Cash-Flow Forecast
• Good overview for Cash flow management.
• Process undertaken in conjunction with your budgeting
process.
• Shows Cash Flow tight spots throughout the year.
Note:
• Be realistic – This is a planning tool for you!
• Cash flow figures always include GST.
• Allow for Tax – GST, Income, Provisional…
• Include opening and closing bank balances.

13. Monthly Cash-Flow Forecasts
Resources
• http://www.bnz.co.nz/business-banking/business-help-and-info/artic
• https://bizhub.anz.co.nz/tools-and-calculators.aspx
• http://www.business.govt.nz/support-and-advice/advice-mentoring/f
• Your Accountant
• Your Book-keeper
• Your Mentor
• Google

14. Daily Cash-Flow Forecast
Setting up a Forecast template:
• Start with setting up a template with the month broken
down.
• Put in the appropriate days and dates.
• Plan out your expected dates for expenditure
– Wages
– Creditor Payments
– Debtor Payments
– Tax Obligations
• Debt breakdowns
– Payment Plans

15. Daily Cash-Flow Layout
Start with setting up a template with the month broken
down.
Cash Flow Template
Overdraft Limit as
at ?? $0.00
Not
Day Date Details Method Freq Paid Outgoing Incoming Balance Notes: Available Funds
MONTH Opening Balance 5,000.00 5,000.00
1st 5,000.00 5,000.00

16. Daily Cash-Flow Layout
6th Telecom DD M 500.00 4,500.00 4,500.00
7th Wages W 3000.00 1,500.00 1,500.00
Drawings 1000.00 500.00 500.00
Estimated Amount and Fixed Date
Fixed Amount and Date
Expected Amount and Date
Note: Highlight regular payments to make sure they are not forgotten
- this will bring them to your attention

17. Daily Cash-Flow Layout
Long Term Debt – Payment Plans
Payment Plan due EOM
Monthly Original
Start Date M Total Paid Owing Notes
Amount amount
Start Date Creditor One 100 BP 5,000.00 5,000.00 0.00 Finished Nov 2012
Creditor Two 200 BP 10,000.00 4,750.00 5,250.00
Creditor Three 300 AP 150,000.00 29,400.00 120,600.00
Westpac CC - Incl
Dec-12 240 BP 480.00 480.00
Int
Westpac CC - Incl
Feb-13 480 BP 4,542.16 4,542.16
Int

18. Daily Cash-Flow Layout
Multiply Bank Accounts
• These can be combined as one or separated out.
– Recommend separate sheets per bank account.
– Personal choice.
• Multiply companies need to be on separated forecasts.

19. Daily Cash-Flow Management
Updating process:
• Reconcile your bank statement.
• Up date your cash flow document.
– Reduce Debtors due as payments are received.
– Reduce the Creditors due as payments are made &/or list individually.
• Show the date balanced to.
“Daily updating creates a Proactive
Decision making process”

20. Using you Cash-Flow
Statement for Management
Lets Analysis our statement:
• Where account becomes overdrawn!
• What figures are still estimates?
• What cash movement can be changed?
• Where might you need to talk to your bank
manager?
• What Debtors do you need to talk with?
• What Creditors do you need to talk with?

21. Next Step
6 Month Financially Fitness Program
Covers all area’s outlined today.
1 day group workshop.
5 x one to one 2 hour coaching sessions.
Next workshop in New Year

22. Early Bird Special
6 Month Financially Fitness Program
Book your space by 20th December 2012
Get 50% off the course cost.
Note:
Course invoice must be paid in full by 15th January 2013.
Payment plans available, these incur an admin cost.