In this article we will talk about:
- What is a financial control tool for?
- Where to save time
- How to post recurring expenses on Cash Flow
- Cash flow worksheet with recurring expense functionality
It may seem a bit obvious, but this is a question every financial manager and business owner should ask themselves. After all the financial area is undoubtedly one of the most important of any business. Understanding whether your revenues are on a downward trend, whether your costs are rising, or even your main indicators, can be the difference between failing and thriving.
Now, most likely a financial control tool will provide you with these items and features:
- Classification of income and expenses in groups of accounts (chart of accounts)
- Simplified posting of revenues, expenses, recurring expenses, installments
- Cash flow control (cash flow) and accrual basis (DRE)
- Control of accounts payable and receivable
- Summary of revenues and expenses daily, month by month
- Simplified display in graphs
- Report ready for printing
At least that is what our complete financial control sheet does. If the spreadsheet or system you use does not allow you all these features, this early in the year may be the time to find a new tool that will give you all the results you are looking for (or should look for).
But that is still not the answer to my question. In my opinion a financial management tool serves to simplify the life of the manager that is using and for this she needs:
- be simple to fill out
- have automatic calculations
- show reports and charts automatically
- be easy to analyze
But delivering this result is very difficult, if you are in doubt if some worksheet will be able to help you, we will see how to spend less time doing the operational filling.
Basically there are 2 core activities that every financial manager needs to accomplish:
- Control of cash flow (operational part of inputs and outputs)
- Analysis of cash flow (managerial part of analysis and planning)
What I see nowadays is a large amount of managers and analysts who waste so much time with the first control activity that they barely have time to perform any kind of analysis. This vicious cycle can greatly hinder the planning of activities to correct problems or take advantage of positive points.
It is precisely at this point, to facilitate the operational fulfillment of its financial control tool that enters the launch of recurring expenses.
Basically, recurring expenses are equal expenses (with the same amount) that happen continuously month after month over a period, which can range from 2 months to infinite months. Now, imagine having to fill the same exits every month.
In the example below, I placed two recurring expenses, one rent payment in the amount of R $ 1.000 (which usually does not change without notice), going from January to December and another, of internet services in the amount of R $ 300. It was two simple releases.
Automatically this was the result (just as an example) for the month of January:
Without the control intelligence of recurring expenses of our complete financial control sheet, it would be 14 releases that I would have to make. Now imagine that you have 70 recurring expenses for the entire year, you could easily waste hours filling up about 840 releases.
So I ask you, is it worth losing that whole time you could be spending on major financial analysis, future budget planning, among other activities? I think not…
If you've had enough of spending time with activities that our complete financial control sheet can do for you, maybe it's time to make changes to your financial control tool!