A cash flow forecast is one of the key aspects of the credit function of a business when corporate marketing and collection forecasts are drawn up. This will aid the finance department to finance the debtor’s ledger. If cash flow falls short of forecasts, additional finance may have to be reduced because of a shortage of working capital. This naturally impacts negatively on the profitability of a business and could lead to the restriction of business activities with the possibility of a reduction in staff.
No comments:
Post a Comment