The goal of any business is to secure a profit from revenue, but the real blood flow of business is cash. It is a powerful indicator of your business’s health, as it is the only way to handle the daily requirements: salaries, supplies, rent, etc.
One way that accounting firms can stay at the top of their game is by reviewing some of their most basic services. This article explores ten ways that you can revolutionize your cash flow management services and instill trust in your clients. These tips should help you evolve from a simple number-crunching service to a more advisory approach, allowing you to glean better insights into your clients’ numbers and goals.
There’s nothing to be done about taxes, folks… nothing to be done.
As you help your client prepare a budget, the firm can also focus on the expected earnings before interest and tax to calculate yearly taxes. You can also provide guidance on how to take advantage of tax breaks available to your client. The goal is to ensure that paying taxes in a timely manner doesn’t impact the available cash for your client.
One crucial aspect of cash and budgeting is preparing for unexpected expenses. In addition to preparing your client to be able to survive for a few months without revenue, the work you’ve done so far — budgeting, expense analysis, etc. — will allow your client’s budget to have some extra cash to be ready for emergencies. Remind your client that, though this cash will ideally never be used, it should also stay untouched as much as necessary. You can also suggest reimbursement practices whenever the contingency fund is used for something else.
There’s always some strength in working with credit, but you have to keep a close eye on accounts receivable to ensure that this credit doesn’t turn into debt for you. Comprehensive control over outstanding invoices and a standardized communication procedure with clients can optimize billing and collections to secure timely payment. AI tools can provide automated account receivable management.
Now, this is easier said than done when you have many clients. Comprehensive advisory services involve an organized analysis of many changing factors from various sources. Sophisticated AI tools like Botkeeper Infinite can help you keep track of any number of clients in a smart, automated interface that easily categorizes transactions, empowering you to offer more reliable and constant support. Click here to learn more about how our approach to accounting AI can help your firm reach its full potential in cash flow management and other key services.