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Whereas accounts payable and receivable deal with the individual charges and payments moving in and out of your account, cash flow deals with the total dollar amounts doing the same.
Cash flow management is especially useful when it comes to assessing the liquidity of a company’s financial assets. If your cash flow is positive, your liquid assets are increasing. This means that you are moving in a direction that will allow you to pay off debts and invest additional money into your business. If your cash flow is negative then your liquid assets are decreasing, and you may be spending more money than you are earning.
It is most beneficial for an outside source like MedCity Consulting to analyze and determine the cash flow of your small business. We can look at your expenditure vs. income totals and determine where problems may occur in the long run. As a third party, we have the ability to look at your financial state in a way that is unbiased and straightforward.