Six secret accounting tips to improve cash flow today
26th April, 2016
Technology brings us so many wonderful things.
Although at times we may find it frustrating, technology itself has made life in business so much easier. One of the most amazing and, dare I say it, game-changing advances has been in online accounting software.
Want to improve your cash flow today? Here are six tips.
1. Create a budget
A monthly budget forecast should tell you who you are paying, when the payments are due, who is paying you and when that money is coming in.
MYOB Essentials’ budgets feature helps you:
- set goals for your business
- document how you expect your business to perform over the year
- review your performance
- identify areas that exceed or fall below expectations.
For more information on budgeting, watch this video.
2. Invoice on the spot
Instead of leaving it to the end of the month, do it as soon as the job is done.
The earlier you invoice, the sooner your payment terms kick in and your customers will pay.
Online accounting software helps here, and the MYOB OnTheGo app lets you invoice from your mobile phone. The minute the work is finished, you can create an invoice and email it to your customer.
3. Set payment terms and stick to them
Of course adding your logo and contact details to your invoice makes it appear far more professional, but that’s not all you can do when you personalise your invoices.
You can also set clear payment terms and methods. Make sure that your clients can clearly see the information set out in your invoice. The clearer you can make your invoice, the less likely clients are to query payment.
4. Give clients more ways to pay you
Make it easy for customers to pay you, and there’ll be fewer excuses as to why they haven’t paid.
If invoicing your customers straight after you’ve finished sounds like a winner, consider adding MYOB PayDirect to your payment options. Turn your smartphone into a card reader, and you’ll be able to take credit card payments and EFTPOS payments on the spot.
Also, MYOB add-on solutions offer a wide range of credit and debit management.
5. Provide discounts on early payments
Some businesses offer incentives for early payments, like a percentage off the price. Some offer discounts for payment several months in advance.
Consider offering some clients the discount on early payments.
6. Bank feeds
Put simply, the bank feed in MYOB is a direct connection between your bank and your MYOB. Of course, you have given you bank permission for this to happen in an easy to link way by either simply signing a form or linking it electronically in your banking on line software.
All the data is brought from your bank, ran through a data verification process and then imported into MYOB by the click of a button.
It then matches up to any existing transactions you have already put in MYOB, you approve it and your job is done.
READ MORE: Cash flow statements: Preparation, examples and a template
MYOB Bank Feeds is so clever that you can literally teach it rules so that it knows what to do when something happens in your bank. You might say that every time if sees a reference from Jo Blogs, then it is to look at invoices in your software for that customer name. You might tell it that every time it sees the working “bank fees” then it is to code it to account 6-**** Bank Feeds with a FRE GST coding.
The beauty of this is that you can go in daily and make sure all your data matches the bank quickly and effectively. You can even see if your MYOB data file and your banks closing balance match and, if there is an out of balance, you can fix it right there and then.
What happens when you finally get your statement from the bank? Go into your bank reconciliation screen as usual and your entries are already ticked off and your balance matches. The bank reconciliation job that would sometimes takes hours is done in seconds.
MYOB bank feeds have saved me hours and hours of time, not to mention hundreds of dollars that we are now saving our clients in time. If I had to choose one thing about MYOB that I loved, it would be the Bank Feeds feature. I can’t not imagine life without it.