By Rob Adamson, Restructuring, Recovery and Insolvency Partner, Armstrong Watson

NOW that it is certain the UK is going to leave the EU, it is likely that there will be a period of uncertainty whilst the negotiations are ongoing.

During these times, it is important to focus on your cash.

Using a cashflow forecast is an essential tool for business planning as it helps business owners to understand where cash is needed and where pinch points might arise. A cashflow forecast allows business owners to understand how various situations will impact cash flow, alongside having visibility on when payments are likely to be received or will be required to be made.

Having full visibility on cash collections can have a real positive impact on your business, so it is vital that focus is given to having a proper credit control process in place so that you can maximise your collections. Without having a rigorous credit control offering, your sales invoices become overdue and your working capital cycle can lengthen, which means that your business can start to struggle with its ongoing liabilities. By honing in on those customers who don’t pay on time, and bringing in outstanding debts, your cashflow will look much better.

Ensuring that cashflow forecasts are continuously updated allows companies to gain a greater understanding of their financial position and what critical payments are likely to fall due in the future. In our experience, companies tend to be aware of a number of customers who are late payers but nothing is ever really done about it. Having a cashflow forecast enables you to monitor your cash position in real time, giving you better oversight of the cash requirements of your business.

As we start 2020, many of us will be making resolutions, so why not make one of your New Year’s resolutions that you focus on your cash collection in 2020? If that sounds like a plan, please contact our team at Armstrong Watson, as we can assist you with understanding and improving your cash position, helping you to be more resilient during these uncertain times. Call 0113 2211 300 or email rob.adamson@armstrongwatson.co.uk