"As an owner of a business, it’s really nice to have control, knowing what’s coming in, what’s going out, and how much cash I have." -Adam Hale

Summary:

In this episode of the Modern CPA Success Show, hosts Tom and Adam discuss their firm's cash flow management service. They highlight the critical role of cash flow in business health, distinguishing it from financial forecasting. Their service includes a 13-week cash flow forecast, regular cash flow meetings, and detailed tracking of accounts receivable and payable. Emphasis is placed on the importance of reconciling bank accounts, maintaining communication, and ensuring accountability. The episode underscores how these practices help business owners stay informed, manage expenses, and make proactive financial decisions.

Finer details of this episode:

• Importance of cash flow for businesses
• Distinction between financial forecasting and cash flow management
• Overview of the cash flow management service offered by the firm
• Benefits of regular cash flow meetings for business owners
• Process of tracking cash inflows and outflows
• Role of bank account reconciliation in cash flow management
• Structure and efficiency of cash flow meetings
• Importance of communication and accountability in financial processes
• Best practices for handling invoices and payments
• Proactive approach to collections and managing outstanding invoices

Episode resources:

● Summit Virtual CFO by Anders website: https://www.summitcpa.net/

● If you have questions or would like to be a guest on the show, email us at mcpasuccessshow@anderscpa.com

● Check out the Virtual CFO Playbook Course: https://vcfoplaybook.summitcpa.net/

Timestamps:

Introduction to the Podcast (00:00:00)

The host introduces the Modern CPA Success Show and its mission to support accounting firms.

Discussion on Cash Flow Service (00:00:22)

Tom and Adam begin discussing the cash flow service offered by their firm.

Importance of Cash Flow (00:00:35)

Adam emphasizes the critical nature of cash flow for business survival and its management.

Distinction Between Cash Flow Services (00:01:01)

Adam explains the difference between financial forecasting and the cash flow management service.

Overview of Cash Flow Management (00:01:56)

Adam discusses the detailed aspects of cash flow management, including tracking income and expenses.

Weekly Cash Flow Meetings (00:02:35)

Tom highlights the value of weekly meetings for business owners to monitor cash flow.

Bill Payment Process (00:03:16)

Adam discusses the bill payment process and the importance of client oversight.

Clarification During Meetings (00:05:24)

Tom and Adam talk about the benefits of asking questions during cash flow meetings for clarity.

Meeting Duration and Frequency (00:06:33)

The speakers outline the typical duration of cash flow meetings and their frequency.

Best Practices for Invoice Management (00:07:51)

Tom emphasizes the importance of using a centralized system for managing invoices.

Accountability in Collections (00:08:38)

Adam stresses the need for accountability in following up on overdue payments.

Preparation for Cash Flow Meetings (00:09:36)

Adam explains the importance of preparation and reconciliation before meetings.

Maintaining the 13-Week Cash Flow Forecast (00:10:21)

Tom discusses the critical nature of maintaining a 13-week cash flow forecast for business planning.

Conclusion and Client Dependency (00:10:51)

The importance of the cash flow service in building client relationships is highlighted.