Managing Different Banks in Cash Flow

0
7346
Excel Spreadsheets

In this article we will talk about:

Companies working with more than one bank

One of the biggest problems we encounter when analyzing companies that already control their cash flow efficiently is the lack of more specific analyzes. For example, I've seen managers who knew exactly how much revenue they had at the end of the month, but who did not have the exact notion of what balance was available in each bank (or bank account) they used on a day-to-day basis.

How to Manage Different Banks in 1 Cash Flow

This is why understanding your cash flow with a bank analysis is essential for better financial control. Regardless of how many bank accounts you have (as long as it is more than one), tracking the amount of income and expenses you are entering for each option can be the difference between having a financial life without problems or having a red bank account paying interest unnecessary.

Excel Spreadsheets

Controlling more than one bank in cash flow

Now that we understand that it is important to make this control, let's look at the example of a business that can benefit by using a cash flow sheet with bank analysis:

Restaurant with account in 2 different banks

Anywhere in Brazil it will be common to find restaurants that have more than one bank account and use one to make payments of suppliers and direct costs, which has quick exit and the payment is more difficult to be parceled out and another to pay the costs (wages, rent, etc.).

Usually the differentiation of different bank accounts or banks already occurs in the same chart of accounts:

cash flow with bank analysis - chart of bank accounts

From this division, if the establishment wants to have real control of each bank account, you will need to look at the statement daily and compare it with the postings being made. Let's look at the example of revenue and expenditure separated by bank for the month of September. Note that the daily postings are taking the total for the day and that we have a payment date (5 day):

cash flow with bank analysis - September expenses

In this analysis we realized that for the month of September the restaurant had a positive balance of R $ 26.500 even after making its main payments. If we were left with that vision we would have the impression that everything is fine, but it is very important to do more specific analyzes of the cash flow per bank.

If we look only at the month of September for Banco Itaú (which is the bank for receipt of revenues), we will see that the balance is in R $ 44.500 at the end of the month:

cash flow with banking analysis - September itau

Now, if we look at the Santander bank account in the same period, we will see that the accumulated balance reached negative R $ 18.000, which indicates that if nothing is done, interest (usually very high) will have to be paid.

cash flow with banking analysis - september santander

At this point you arrive at a simple yet important decision-making moment in your day-to-day financial management:

  • Take a loan to clear the account
  • Transfer from one account to another

Although it is obvious the decision to transfer money, I have seen managers who lacked this banking control ended up paying high interest without even knowing that they had a negative account. Therefore, having a cash flow sheet with bank analysis and with the possibility of making transfers between banks is important. See in our example the transfer postings we made:

cash flow with bank analysis - interbank transfer

In practice, we transfer R $ 20.000 from one bank to another, generating the following flows and accumulated balances for the month of September:

cash flow with bank analysis - september santander pos transfer cash flow with bank analysis - september itau pos transfer

So I managed to keep both accounts in the positive and without risk of financial losses tied to overdraft interest or pre-approved limits.

Do not forget the simplified cash flow

In addition to the control of banks, we can not forget the primary function of a cash flow, which is to provide statements that allow you to have a view of your income and expenses, as shown below:

cash flow with bank analysis - annual cash flow

This view is further facilitated when analyzed in graphs. In our example, we clearly had bad months in May and August (green line below zero).

cash flow with bank analysis - annual cash flow graph

In general, it is important to always keep an eye on the main indicators such as revenues, expenses, profit or loss, profitability, accounts payable and receivable, but not forgetting the more specific analysis, which in our case refers to bank accounts.

How about starting to control your bank accounts and banks?

If you have problems similar to the ones I quoted throughout the article, maybe it's time for you to use the cash flow sheet with bank analysis. If your case is more complex and involve:

  • Different forms of payment
  • Costs of cost
  • Financial planning
  • Customer and supplier analysis

I recommend complete financial management worksheet.

How to Manage Different Banks in 1 Cash Flow

Excel Spreadsheets

LEAVE AN ANSWER

Please, write your comment
Please enter your name