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Accountant & Bookkeeper Resources on Cash Flow Forecasting

March 4, 2022

Accountant & Bookkeeper Resources on Cash Flow Forecasting

Ariel Gottfeld

Ariel Gottfeld

Businesses rely on accountants and bookkeepers to keep their finances in order. Accountants, in particular, play an integral role not only in tax-related tasks but also in cash flow forecasting, business advisory and other core financial tasks.

It's essential for business owners to understand what business advisory is, the services provided by accounting firms and how advisory services can help them.

What Is Business Advisory?

So, what are business advisory services? What is the meaning of advisory services?

Business Advisory Definition: Services provided by business advisors to help companies with their finances, planning, development and marketing.

Simply put, advisory services help a business succeed. Advisors take a closer look at a company's financial situation and health to find areas where things can be improved. Additionally, advisors help business owners make important decisions when it comes to product/service launches, market expansion, opening new locations and more.

Business advisory services can include:

  • Strategy and planning
  • Succession planning
  • Operational reviews
  • Valuation
  • Organizational development
  • Reorganizing and improving business processes
  • Creating financial models, projections and budgets
  • Benchmarking and creating financial or performance metrics
  • Assistance with acquisitions or transactions

Consulting firms often provide advisory services, but many accountants are now offering similar services themselves or through expert third-party services.

What Services Do Accountants Offer Businesses?

Accountants can offer several services to help businesses control and improve their finances, including:

Tax Preparation and Planning

Tax preparation and planning are some of the most common services provided by accountants to businesses. Accountants prepare both federal and state corporate tax returns for businesses. They also prepare year-end documents, like:

  • Employee W-2
  • IRS owner K-1
  • 1099-MISC forms

In many cases, accounting firms can also be given authority to represent business owners in front of the IRS.

Along with tax preparation, accountants can help business owners prepare for the future and take steps to reduce their taxes in the future. Tax planning can help accomplish this goal. Accountants can work with business owners to use legal strategies to reduce taxes in the future.

Provide Advisory Services

In some cases, accountants and business advisers are one in the same. Many accounting firms now offer advisory services that can help businesses make smarter financial decisions, create projections and forecasts, find ways to improve operations, pinpoint areas where expenses could be reduced.

These advisory services are aimed at helping businesses succeed and remain sustainable.

Bookkeeping and Payroll

Business owners wear many hats. Often, owners take on the role of bookkeeper and handle payroll-related tasks. However, it's generally best to have an accounting firm handle these tasks for them.

Accounting firms can be given access to the company's bank account and financial information to create and maintain cash flow records. Additionally, firms can:

  • Prepare profit and loss statements
  • Help with accounts receivable
  • Manage payments, including funds paid to vendors and suppliers
  • Assist with onboarding employees
  • Issue year-end tax documents to independent contractors

Business Valuation and Development

When businesses need to create valuation reports or audits for financing purposes, they rely on accounting firms for help. When companies seek financing, mergers or acquisitions, their operations need to be accurately and properly valued.

Accounting firms can look at the previous year's revenue, growth patterns and books to calculate the company's value.

Business Advisory Service

Advisory in accounting is one of the most valuable yet overlooked services that accountants and bookkeepers can offer. You should strive to bring more value to your clients at all times. The value-driven approach to your advisory business comes from the services you offer.

While we talked about these briefly in the first portion of the article, we want to discuss the advisory services you can offer in greater detail:

  • Assistance with acquisitions or transactions: When businesses acquire others to expand and grow market share, your services can be invaluable. Advisory services help business owners determine if an acquisition is viable, costs to integrate the business into operations and if they're paying too much in the transaction.

  • Benchmarking and creating financial or performance metrics: Offering financial performance and benchmarking services allows businesses to see how their business is operating on a broader level. These services can help clients remove underperforming products or services while also seeing which business units are operating efficiently.

  • Creating financial models, projections and budgets: Models and projections are another invaluable tool in helping fuel business decisions. These services allow businesses to plan their budgets more accurately.

  • Operational reviews: How are the business's operations working? Are some segments overperforming or underperforming? Full operational reviews provide data at your clients' fingertips so that they can understand the true nature of their business operations.

  • Reorganizing and improving business processes: Many business operations need changes and improvements over time. If you offer the right services to clients, it's possible to improve their business, save them money and do it while boosting your own revenue.

  • Strategy and planning: Business planning and strategy are necessary across all industries. Through the services you provide, it's possible to help clients strategize and plan for the future. You can opt to help the business outline their 1-, 2- and 5-year plans and create strategies to reach goals.

  • Succession planning: At some point, owners, partners or directors will leave the company. Succession planning allows businesses to plan for these events by determining who will take over these key roles if the person leaves or passes away.

  • Valuation: Advisory services also include valuation, which is essential when seeking financing, selling a business, purchasing another business or merging with another business. Previous financial data is used to create an accurate valuation for the business.

An advisory business is one that you create. You have complete freedom to mix and match these services to provide unique packages that benefit your customers the most.

Accountants Provide Cash Flow Consulting To Business Clients With Cash Flow Frog

Accounts can provide industry-leading client advisory services through the use of next-level cash flow forecasting solutions, such as Cash Flow Frog. Our platform makes it easy for CPAs across multiple industries to offer cash flow consulting.

Consulting solutions help accounting firms in numerous ways, such as:

  1. Reducing reliance on tax season revenue to keep operations running smoothly. Instead, through cash flow consulting, it's possible to fill the void in your own personal cash flow and maintain steady financials all year long.

  2. Offer new, exciting options for current customers to improve their lifetime value. By extending your services, it's possible to sign more lucrative contracts and upsell existing customers, too.

  3. Attract new clients with the help of cash flow consulting. The more products and services you offer, the greater the void you'll be filling in the industry.

Cash Flow Frog can help you bring your practice to the next level with solutions that streamline operations and help make you money.

A few of the features that Cash Flow Frog puts at the fingertips of accountants and bookkeepers are:

  • Forecast and track cash flow performance. Graphs and charts help businesses make sense of forecasts and are vital in the decision-making process.

  • What-if scenarios are easy to plan and view to visualize what happens if cash flow goals are met or missed. These scenarios are essential when introducing new products or services because they indicate which direction investments can go.

  • Compliance is important for every business. Cash Flow Frog allows you to offer advisory services that empower your clients while improving your bottom line.

  • Real-time forecasts are reported once the first forecast is done. The initial forecast takes just minutes to complete to provide valuable, immediate insight into a business's financial health. Furthermore, real-time tracking allows you to become an integral part of a business's decision-making process.

  • Reports can be fully branded to meet the brand cohesion needs of accountants and bookkeepers. Use your logo and provide branded reports to clients that build awareness and add professionalism to your services.

  • Integrate all of these features into industry-leading software, such as QuickBooks and Xero. Once integrated, it's possible to keep forecasts updated in real-time.

While many features are available, these are some of the most important. You'll also have the option to break down forecasts by day, week or month to better understand how seasonal changes impact businesses.

Customer insights provide in-depth data to businesses about their most important customers. Owners will have the opportunity to see which customers often pay the fastest and which lag behind on payments, causing significant cash flow problems in the process.

Actual and planned cash flow can be defined within the tool along with a reports editor to show clients the most insightful data available.

Accountants and bookkeepers can leverage the power of cash flow forecasting with powerful tools that help you understand a business's financials. In an era of business where big data and forecasting is crucial to making smart business decisions, these services boost revenue for accountants while empowering businesses to fuel growth.

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