Cash / cash forecasts

• What is cash in a business context?

  Money in notes, coins, or bank accounts
• Why is cash important for a business?

  It prevents unpaid bills and legal issues
• What happens if a business cannot pay its staff?

  Staff may leave due to insecurity
• How does running a business with multiple staff and customers complicate cash management?

  More cash is needed to meet obligations
• What challenges do startups face regarding cash?

  Initial investments and delayed income
• What can happen if a restaurant faces building delays?

  It may lead to a cash deficit
• Why is it crucial to pay suppliers on time?

  To avoid empty shelves and customer loss
• What could happen if a business fails to pay its bills?

  It may lead to operational shutdowns
• What are the consequences of not managing cash effectively in a business?

  • Unpaid bills lead to legal issues
  • Staff may leave due to insecurity
  • Suppliers may stop providing goods
  • Potential for complete business failure
• What are the key cash management challenges for a startup business?

  • High initial investment costs
  • Delayed income from customers
  • Need for hiring and training staff
  • Potential building delays and cost overruns
• What is cash flow?

  The process of money in and out of business
• What is cash inflow?

  Money that comes into the business
• What is cash outflow?

  Money that goes out of the business
• How is net cash flow calculated?

  Total cash inflow minus total cash outflow
• What is the opening balance in cash flow forecasts?

  Closing balance of the previous period
• How is the closing balance calculated?

  Opening balance plus net cash flow
• What are the key components of cash flow forecasts?

  • Cash Flow
  • Cash Inflow
  • Cash Outflow
  • Net Cash Flow
  • Opening Balance
  • Closing Balance