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Oftentimes, says CFO services, you are going to be able to strike up and an agreement with your big bill suppliers in order to potentially pay them off in a payment schedule, or later than normal. All they really potentially want to see is the fact that you are making a concerted effort in order to pay off those bills.
CFO services also states the fact that after you have done so and put as much money as you possibly can towards the big bills, make sure that you have completely paid off all of your smaller bills.
What this can potentially do, is this can relieve you of a lot of your stress and take a lot of the stuff off of your shoulders so that you can concentrate a lot more on other things and you can of a lot less on your plate.
CFO services want to take a look at all of your balance sheets and ask if you have noticed any negative numbers with in your balance sheets? If you have prepaid for something such as rent, a deposit for a contractor, etc. it is going to show up as a negative AP. What this happens is this has happened because you have paid it before they have build you. Sometimes it can be a legitimate expense, which is why you have sent them the money in the first place. The reason that you have no recollection of it or no paper trail of it is because you have never been booked the expense. The supplier however will be very happy that they have their money but the income statement is wrong.
The reason why the income statement is wrong is because you haven’t shown any of the expenses on that particular business yet. All it is showing is the fact that the cash has gone out and a prepayment has been made.
When you look at a negative number four example, on the AP aging summary, you’re going to have to ask yourself, have you prepaid something or do you have a credit on file? Oftentimes another question that you’re going to need to ask is is there an expense that could potentially be missing.
If there is legitimately a expense that is missing, that can cause a little bit headache in the fact that you have to go back and if you are not organized, you’re going to have to find the problem and the particular biller the invoice that that belongs to.
If you are not organized and you are not putting anything into categories column or, columns, you’re not going to be able to find that Bill easier than you thought you might. Make sure that you are giving every thing its own individual column, and its own individual jewel statement. That will allow you to better be able to find things, and better be able to organize and do all of the payments.
CFO services states that you shouldn’t necessarily make sure that the payment coincides with the bill.
The AP aging summary is a great quick reference for you to legitimately get on board and understand exactly what is happening from your account and when the account has been reconciled.
As well, you may or may not have to do a very quick audit on all of your accounts to make sure that all of the bills are definitely coinciding with the payments and the money. If there is in fact a decimal that’s out of place, or a number that’s at a place that can cause a lot of headaches with you, your financials, and your suppliers. It can potentially come down to a particular argument when you think something is all of the eyes are dotted and the teaser crossed.
As well, your going to need to think about, says CFO services, the amount owing in terms of the little payments as well. Those are going to be a nag on your shoulders, if you don’t necessarily pay those off as soon as you possibly can.
Bear in mind that those little payments can definitely grow into bigger payments and will become a bigger pain for you in the future if they are not dealt with.
Make sure you’re allocating a lease reasonable amount of funds to the other bills. Make sure you have a plan as well with your charter professional accountant so that you know exactly how you’re going to pay off all of these bills and where the money is coming from. When a payment definitely comes in for your accounts, you are going to want to think to put those in separate columns so that they are better organized and you’re going to be able to find and see very quickly what you have and haven’t paid.
CFO services advises the more time on revenue-generating activities that you’re going to possibly be able to make, the better it is definitely going to be for you. It is going to spend a little more time on revenue-generating activities with your charter professional accountant that is going to potentially save you and will prevent you from being one of the statistics that 50% of small businesses will fail within the first five years of inception.
You can definitely have a good relationship with suppliers if you have made a very obvious effort to pay all of the bills off. You don’t necessarily have to pay it all off in one lump sum, although that would be great. Instead, payoff as much as you possibly can and communicate with your suppliers so that you know exactly that they are behind you and that they support you and that they know as well that they will definitely get their money as soon as possible can. See if a service needs you to understand the fact that it is going to be super important to have that relationship with your suppliers.
