A Better Way to Monitor Cash

Traditionally, few CFOs have taken the time to forecast their balance sheets, preferring to rely on their P&Ls to monitor their cash levels. This is primarily due to the difficulty – i.e. near impossibility – of trying to do it in Excel. But the balance sheet provides critical details that you could easily miss in your P&L. 

Assume you know your company has earned $1 million in revenue for a month, and has $800K in expenses. Your P&L would indicate that you have $200K in cash on hand when in fact, that may not be the case at all. Your sales team may have offered unusually long payment terms for a client, meaning you won’t realize a chunk of revenue until some point in the future. And although you’ve incurred $800K in expenses, your own payment terms may mean you don’t need to pay an invoice immediately or all at once.

These are the kinds of details that are captured in Planning Maestro’s balance sheet forecasts, and it’s the only way to monitor how much cash your company will have in the months and quarters ahead.