Sei sulla pagina 1di 35

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow

report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

PRESS RELEASE
New book offers guidance for helping every one preparing their daily business cash flow report
Now Everyone Can Prepare Daily Cash Flow Report by Kamarulzaman Baharom offers a narrative guiding principle for helping business owner to understand the daily cash flow report. Kuala Lumpur, Malaysia June 11, 2011 Now Everyone Can Prepare Daily Cash Flow Report by Kamarulzaman Baharom is a book intended to help every business owner understand their business cash flow and how they can prepare it in a daily basis. I would like to quote what Donald Trump said in his book Think Big, Finance and business are dangerous waters where vicious sharks are swimming around looking to feed on innocent novices. In this game, knowledge is the key to power. Spend the money necessary to know what you are doing or somebody will quickly be doing you with this book you can leverage on my 13 years experience in cash management and you can prepare your daily business cash flow like a professional, in a couple of days Kamarulzaman says. He added Preparing a daily cash flow report is one of the greatest challenges every one can face since there is not even one book in the market than can give you a comprehensive guiding principle to follow With this in mind, Now Everyone Can Prepare Daily Cash Flow Report offers a narrative to help every business owner understand how powerful and informative is the cash flow report for their business and how they can prepare it no matter how large is their business. Among other analogies, Kamarulzaman explains how a comprehensive and full graphic tutorial can guide them not only one but up to three banks simultaneously involved, making preparing a daily cash flow report as easy as using a normal excel spreadsheet. This book is meant to be a way of telling all business owner how easy they can grasp their business financial health as the way every accountant knows their stuff Kamarulzaman says. It addresses how preparing a daily cash flow report in a new and unique way one that I hope can be of benefit to every business owner in the planet who is struggling with difficulty to prepare the most important report in business Written to be shared by everyone, the book is intended to spark productive interactions about the importance of the business cash flow. Now Everyone Can Prepare Daily Cash Flow Report is available for sale online at Amazon.com, Apple iBookstore and lulu.com and are available for purchase on iPad, Kindle, Nook, Kobo, iPhone, iPod touch, PC, Mac, Blackberry, and Android-based devices.

About the Author Kamarulzaman Baharom has been entrusted to develop and monitor a cash management system for a multinational company for more than 13 years now. Through his rigorous years of developing cash management system for a company, countless errors and failures, he finally has cracked a code where almost everyone can prepare a daily cash flow report for their business. MEDIA CONTACT Kamarulzaman Baharom E-mail : kamarulzamanbaharom@gmail.com REVIEW COPIES AND INTERVIEWS AVAILABLE The press release has been published in media and one of them can be viewed here;

http://www.i-newswire.com/new-book-offers-guidance-for-helping/113388

This publication is designed to provide competent and reliable information regarding the subject matter covered. However, it is sold with the understanding that the author and publisher are not engaged in rendering legal, financial, or other professional advice. If legal or other expert assistance is required, the services of a professional should be sought. The author and publisher specifically disclaim any liability that is incurred from the use or application of the contents of this book.

Copyright 2011 by Kamarulzaman Baharom All rights reserved. No part of this book may be used or reproduced, in whole or in part, in any form or by any means electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system now known or hereafter invented, without permission from the author.

First Edition April 2011

TABLE OF CONTENTS
__________________________________________________________________

INTRODUCTION .5
Cash is King ...5 The Importance of Cash Management ....6

CHAPTER 1 .9
WHY WE SHOULD KNOW THE COMPANYS CASH POSITION NOW

CHAPTER 211
HOW TO PREPARE DAILY CASH POSITION REPORT SINGLE BANK Step 1 : How To Record Your Payment...13 Step 2 : How To Record Your Collections..15 Step 3 : Your First Daily Cash Flow Statement.......18 Step 4 : Weekly Cash Flow Statement.. 21 Step 5 : More Sample On Receipts And Payments..27 Step 6 : More Advance Step By Step On How To Prepare Daily Cash Flow.28

CHAPTER 3....41
HOW TO RECTIFY THE ERROR MADE DURING OUR PREVIOUS TRANSACTIONS

CHAPTER 4......55
HOW TO PREPARE DAILY CASH POSITION REPORT MULTIPLE BANKS Step 1 : How To Record Payments From Multiple Banks.57 Step 2 : How To Record Collections For Multiple banks..61 Step 3 : How To Prepare Cash Flow Report For All The Banks...63

CHAPTER 5..69
TRANSACTIONS AT THE END OF THE MONTH The Importance of Preparing Bank Reconciliation Statement...71 Final Stage - How To Record Transactions Appear In Bank Statement....74

FINAL THOUGHTS.....80

INTRODUCTION
__________________________________________________________________ Cash is King Everybody knows the phrase of "cash is king". Is it true in a perspective of the business atmosphere today? Based on my 13 years experience in cash management, where I have monitored a business cash flow in a daily basis for the past 13 years in a public listed company, I cannot say it more than 110% agreed with the statement. I have experienced how tough it was when our company's coffer dried up due to excessive payment made to our subcontractors and suppliers not mentioned the overhead cost involved as well. What to do? Using our overdraft facility? Yes, it should be the way but overdraft utilization can only be considered as a short-term solution only. We have to find out a rock-solid solution or else we will be suffering in the future. I mean deadly self destruction! From my experience, we have to sense earlier the warning sign of cash problem or else it will already be late. But how to detect it? This is how preparing a cash flow report is crucial to a company or enterprise. Sounds familiar? Every company has already prepared it but why the cash flow problem is still keep on going. What went wrong? Nothing wrong, but you have to take into account of another powerful reports which I call it a daily cash position reports. It is like a car dashboard where you keep an eye on the important cash figures just with a quick look, just like your car dashboard! How to do it? From my experience, I have not seen any books that explain or expose how to prepare a daily cash position report. I have to list down
7

the very important cash features which has been listed by Accounting Professional Body and have to workout for more than 13 years to perfect it. The Importance of Cash Management Why is good cash management system is very important to today's business atmosphere? Every companies and enterprise must have some good cash management system in order to sustain the company's cash liquidity so that it must always positive at all time. If not, the cash manager must find a solution on how to funding the cash flow shortfall. What are the cash manager's duties in order to accomplish his or her role effectively and professionally? Here are the list of cash manager's duties according to Financial Handbook by Alexander Hamilton Institute Inc; 1. Bank relations 2. Debt management 3. Cash forecasting 4. Improving receivables processing 5. Speeding collections 6. Receipts forecasting 7. Maintaining liquidity 8. Short-term investing 9. Managing investments 10. Overseeing bank accounts 11. Reducing idle balance 12. Slowing disbursement 13. Cash conservation
8

In 1997, just before the Asian economic downturn, I have decided that I wanted to be a company's treasurer or in other words to take care of a company's cash management system. Although our company was a public listed company, we still did not have a good cash management system at that time. When I came across the Financial Handbook as explained above and find out the cash manager's duties, what I did was I just listed all the duties in my new job descriptions. After a long process of developing the system, improved and perfected it with a real corporate atmosphere and sometimes experienced a very ill-fated lesson in performing the task. I have established and developed a comprehensive system to all the responsibilities as listed above and fine tuned the process so that it will interact beautifully and give an excellent daily cash position report for my financial analysis. It takes more than 13 years to perfect the method and I think its more than worth it to dedicate my career in cash management. One way to grasp the importance of cash management is to view cash as your most important resource. Your goal then is to ensure that your supply is always sufficient to the needs of your company. You may take advantage of discount offered by your suppliers because of your prompt payment to them or manage to earn extra income of your surplus fund as a result of your well-timed and properly manage of your business cash flow. I have spent more than 25,000 working hours to perfect the cash management system and off course this inclusive spending my time trying to comprehend the daily cash flow report as perfect as I can in view of the fact that this is the most important financial knowledge that you needs to master as a basement of your cash management solid buildings structure.

Stay tune and start practicing with a real corporate atmosphere in executing the daily cash flow report. You may surprise that you now have a timely and perfect information in bringing your company to a right path towards a greater height of your financial goal.

Kamarulzaman Baharom

10

CHAPTER 1
Why We Should Know the Company's Cash Position Now The importance of knowing the company's daily cash position cannot be denied. It is a very important data in order for us to make a next movement in business, whether to prepare payment for our suppliers or overhead expenses, invest our surplus fund in short term investment or just for our own knowledge with the intention that we know we are on a right trail and our financial position is in a good shape. To demonstrate the concept well, let us assume that we are driving a car and the first thing that we might do is to glance the fuel gauge at the car dashboard. What we are more concerned is the fuel indicator at that time whether we still be able to continue driving or have to stop at the next petrol station to refill the fuel. It is not last week fuel data or last month data that bothered us, we want the car's fuel position now in order to make decision whether to stop at the next petrol station or not. This applies to the same idea where company's cash position is concerned. What we really wish is the company's cash position now and not last week or last months information. The data has already historical and cannot be used to make a decision whether we wish to prepare payment or to invest excess fund in a short term investment. In essence, I just want to share with you three types of cash data that we are usually familiar with and to a certain level we can make use of the data. The first data is a cash flow statement at the end of the month. This is the most well-liked technique and recommended by all Accounting text book and academicians. The cash flow statement is normally derived from Balance Sheet and Profit & Loss
11

Account for the month. While the cash flow report generated using this method is acceptable and follows the Accounting Standard, we need an additional report so as to give us more meaningful daily cash flow report to allow us to make a daily financial review. Here comes the second method of cash flow data which is called Daily Cash Position. If we take into consideration the daily incoming cheques and daily cheques disbursement, your cash balance will show you a precise cash position at any point of time. The third method which is the most risky method is by simply call the bank and requested the companys bank balance without comparing with the daily cash position as explained in the second method above. The key differences between the second and third method is that the bank balance today is not the same with daily cash position. This is because cheques that we have already disbursed are not automatically all presented on that day and the bank balance will includes the unpresented cheques or in other words our cheques prepared are still not cleared by the banking system. If we would like to make a decision on the bank balance alone, this will definitely act as a time bomb which will gravely damage your business. Your companys bank balance will be overdrawn owing to the payment overspent due to miscalculation of the cheques prepared.

12

CHAPTER 2
How to Prepare Daily Cash Position Report Single Bank As I have mentioned earlier, cash flow report is a very important report that every business owner or entrepreneur must be able to analyze so that they can plan for their next move in business. Almost all business gurus have stressed on the importance of preparing daily cash flow report but unfortunately none of them gave specific guiding principle on how to prepare it. Cash flow report that we mentioned here is a dynamic or active cash flow report where it will show us the cash position at any point of time and at the same time can act as a powerful tools to make as much money as we are capable of by investing the surplus fund in a very short term investment such as money market placement. Cash flow statement that every accounting text book recommended is cash flow report generated from Balance Sheet and Profit & Loss Account and will give us depth analysis on net cash flow recorded from operating, investing or financing activities. First and foremost, if we have only one bank, the opening balance for our cash position for that month must be the closing balance for the previous month. This can be derived from the Balance Sheet section under current asset which will state the closing balance of the bank balance for the preceding month. If for any reason the enterprise is not capable to generate their company's account such as P&L and Balance sheet due to their company's scale, they can come across the closing balance from their cash book as this is the fundamental information that they have to prepare if they still have not set up the accounting system for their business. If you have only one bank for your business, it is wise able to prepare your payment according to the payment categories in your cash flow statement. For
13

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

14

Lets Do it Step 1 How To Record Your Payments Since this is the first book in the market that will show you and guide you on how to prepare your daily cash flow report, you have to put into practice by following step by step instructions using diagram or table which ever is applicable. First of all, lets name our sample company as Prolink Enterprise and the company is essentially a construction company. I would like to emphasize here that this daily cash flow technique will work no matter how big is your company. Whether your company is a sole proprietor company or a public listed company, as long as you follow precisely the process that I will explain to you, it will works tremendously and will certainly serve the ultimate purposes; a powerful daily cash flow report. As an illustration to the above sample, lets say that you only have one bank and lets name the Bank as CIMB Bank. To make the life easier, as mentioned earlier you have to prepare your payment according to your major payment categories in your payment section.

If you have determined that your major payment categories are for payment of subcontractors, suppliers, utilities bills, salary and others. You should pile up your payment according to the above categories. For an illustration, just consider that you intend to prepare the above payment as follows; ~ You intend to prepare 20 pieces of cheques to the subcontractors for the amount of $45,000.00

15

~ You are going to prepare 10 pieces of cheques to the suppliers for the amount of $ 15,000.00

~ You want to make payment for utilities bills such as water bill, electricity bills, phone bills and the total amount for these bills are $ 1,250.00 and you need 3 pieces of cheques to prepare it. ~ You realized that you need to pay your employees overtime and certainly you will categorize it as under salarys category. You have to pay up another $ 2,500.00 and need to prepare 5 pieces of cheques for your 5 employees. Thats all. These are the expenses you might want to prepare right away and you are going to prepare it on 5 Jan 2011. For an illustration, lets assume that the cheques serial number are started from 000001 and ended at 000039

After you have prepared the payment, you should record the transactions as follows; Prolink Enterprise CIMB Bank
Date 5-Jan-01 Serial No 000001 000039 Subcontractor 45,000.00 Suppliers 15,000.00 Utilities Bills 1,250.00 Salary 2,500.00 Others

Figure 1.1
16

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

17

Prolink Enterprise Cash Position As At 5 Jan 2011


CIMB Bank

BALANCE B/F AS AT 31 DEC 2010 RECEIPTS Road Builder Inc ELITE Inc Sure Rich Inc Alpha Construction Beta Organization Others Cheque cancelled TOTAL RECEIPTS PAYMENTS Subcontractors Suppliers Utilities Bills Salary Others TOTAL PAYMENTS

50,000.00

35,000.00 2,500.00 1,500.00 39,000.00

45,000.00 15,000.00 1,250.00 2,500.00

63,750.00

BALANCE C/F

25,250.00

Figure 1.4

~ From the above statement, we will notice some important data that I will explain to you as follows;

18

~ The balance brought forward (b/f) of $ 50,000.00 was a closing balance of 31 Dec 2010.

~ The closing balance carried forward (c/f) of $ 25,250.00 was a closing balance for 5 Jan 2011.

~ The receipt of $ 39,000.00 is the total receipt from 1 Jan 2011 till 5 Jan 2011 likewise the total payment of $ 63,750.00 is the total payment from 1 Jan 2011 till 5 Jan 2011.

~ So in a nutshell, the amount of $ 25,250.00 is the amount that you still have in your bank balance as at 5 Jan 2011. In other words, at the current moment you can only issue cheques for expenses not exceeding $ 25,250.00. Not more than that, or else your account will be overdrawn or overspent and you will have a trouble with your bank.

~ From here, as we wish to know the total receipt, the total payment and the total amount which has been generated from the business operation at any point of time all the way through the whole month, we need to prepare another report which is more interactive and quite tricky to prepare for whom who is not quite familiar with Excel spreadsheet. But dont worry, I will explain to you step by step.

19

Step 4 Weekly Cash Flow Statement As mentioned above, the cash flow statement in Figure 1.4 is just a cash flow that only shows the cash position from 1 Jan 2011 till 5 Jan 2011. As we move on throughout the month, we still need to know for instance cash flow statement as at 10 Jan 2011, cash flow statement as at 15 Jan 2011 and so forth until we reach 31 Jan 2011.So, how to do it?

For that purposes, we have to divide the income and payment column into 4 columns, which represent 1 column for each week. The reason of doing this is simply easier to monitor our cash position performance by weekly basis instead of just zoomed into 1 month cash flow statement which is quite difficult to prepare if you have a huge data to slot in into collection and payment column.

The other reason that I think is much more important is to guarantee that our cash flow report is always perfectly done and faster to prepared. Supposed that in the third week of Jan 2011 you had hay-wired the cash flow statement without precisely known where you have made the mistake due to a high volume of data you tried to fit in, what you have to do is you just simply started fixing the cash flow statement from 2nd week of Jan 2011 onwards where you had make sure that the 2nd week of Jan 2011 report was correct before you move on to 3 rd week of Jan 2011 .This will reduce the hassle of starting all over again from 1 st Jan 2011. Dont this make your life easier and you can fix the mistake much faster?

Here is the cash flow report as at 5 Jan 2011 looks like when you had successfully slot in the numbers from Figure 1.4 ;

20

Prolink Enterprise Cash flow Statement For The Month Of Jan 2011
1 st week (1/1 - 5/1) TOTAL BALANCE B/F 50,000.00 2nd week (8/1 - 14/1) 25,250.00 3rd week (15/1 - 21/1) 25,250.00 4th week (22/1 - 31/1) 25,250.00 1 Jan 2011 - 5 Jan 2011 50,000.00

Road Builder Inc ELITE Inc Sure Reach Inc Alpha Organization Beta Organization Others 1,500.00 2,500.00 35,000.00

0.00 35,000.00 0.00 2,500.00 0.00 1,500.00 0.00

TOTAL RECEIPTS FROM OPERATING ACTIVITIES

39,000.00

0.00

0.00

0.00

39,000.00

PAYMENTS Subcontractors Suppliers Utilities Bills Salary Others 45,000.00 15,000.00 1,250.00 2,500.00 45,000.00 15,000.00 1,250.00 2,500.00 0.00

TOTAL PAYMENT FOR OPERATING ACTIVITIES NET CASHFLOW FROM OPERATING ACTIVITIES

63,750.00 (24,750.00)

0.00 0.00

0.00 0.00

0.00 0.00

63,750.00 (24,750.00)

BALANCE C/F

25,250.00

25,250.00

25,250.00

25,250.00

25,250.00

Figure 1.5

21

And finally this is the final product of your cash flow statement that you just created. I hope you could understand the idea behind this report and be able to carry out a simple formula in Excel such as how to add or subtract between the cells in the spreadsheet.

22

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

23

Step 5 More Sample On Receipts And Payments As we move along the way through the month of Jan 2011, Prolink Enterprise has recorded more transactions and the transactions are tabulated as follows;

~ Beta Organization had posted a cheque amounting to $ 25,000.00 and has been deposited into the companys bank account on 8 Jan 2011.

~ ELITE Inc has transferred via telegraphic transfer of fund for the amount of $ 18,000.00 into Prolinks CIMB current account on 9 Jan 2011

~ On 8 Jan 2011, Prolink Enterprise has issued 5 cheques totaling $ 5,000.00 meant for their site office petty cash expenses.

~ Payment for 5 subcontractors and 3 suppliers amounting to $ 20,000 and $ 8,500.00 respectively has been prepared on 10 Jan 2011. ~ Our site offices personnel had personally collected one cheque from Road Builders Inc on 11 Jan 2011 for the amount of $ 18,000.00 and straight away deposited into the companys account on the same day.

~ As promised earlier, Gamma Inc has issued a cheque totaling $ 4,500.00 on 12 Jan 2011for the small services works undertaken by us but the cheque is only deposited a day after.

~ A telecommunication bills totaling $ 2,500.00 has been prepared for 2 telcos companies on 13 Jan 2011.
24

Step 6 More Advance Step By Step On How To Prepare Our Daily Cash Flow Report ~ In Figure 1.1, we have prepared the payment by organizing the invoices according to their respective categories. We will just continue with what we have done before and the payment listing, if you have done correctly it will emerged as follows; Prolink Enterprise CIMB Bank
Date Serial No 5-Jan-01 000001 000039 13-Jan-01 000040 000054 Subcontractor 45,000.00 20,000.00 Suppliers 15,000.00 8,500.00 Utilities Bills 1,250.00 2,500.00 Salary 2,500.00 Others 5,000.00

Figure 1.9 ~ You will notice that we had prepared a total of 15 pieces of cheques and the serial no of the cheques were started at no 000040 and ended at no 000054. The date of the cheques for the serial no of 000041 was 8 Jan 2011 and ended on 13 Jan 2011 for the serial no of 000054.

~ On the payment listing list as shown at Figure 1.6 above, we will only key in the last date of the cheques prepared which falls on 13 Jan 2011. This will give an indicator to us that payment from 6 Jan 2011 till 13 Jan 2011 is still not recorded into the cash position. Remember, we had recorded earlier the transaction from 1 Jan 2111 till 5 Jan 2101.

25

~ The next step is , we will insert the numbers from Figure1.15 into monthly cash flow statement. First we need to unhide the weekly column as in Figure 1.8 and it will looks like Figure 1.16 as follows; Prolink Enterprise Cash flow Statement For The Month Of Jan 2011
1 st week (1/1 - 5/1) TOTAL BALANCE B/F 50,000.00 2nd week (8/1 - 14/1) 25,250.00 3rd week (15/1 - 21/1) 25,250.00 4th week (22/1 - 31/1) 25,250.00 1 Jan 2011 - 5 Jan 2011 50,000.00

Road Builder Inc ELITE Inc Sure Reach Inc Alpha Organization Beta Organization Others 1,500.00 2,500.00 35,000.00

0.00 35,000.00 0.00 2,500.00 0.00 1,500.00 0.00

TOTAL RECEIPTS FROM OPERATING ACTIVITIES

39,000.00

0.00

0.00

0.00

39,000.00

PAYMENTS Subcontractors Suppliers Utilities Bills Salary Others 45,000.00 15,000.00 1,250.00 2,500.00 45,000.00 15,000.00 1,250.00 2,500.00 0.00

TOTAL PAYMENT FOR OPERATING ACTIVITIES NET CASHFLOW FROM OPERATING ACTIVITIES

63,750.00 (24,750.00)

0.00 0.00

0.00 0.00

0.00 0.00

63,750.00 (24,750.00)

BALANCE C/F

25,250.00

25,250.00

25,250.00

25,250.00

25,250.00

Figure 1.16

26

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

27

CHAPTER 4
How to Prepare Daily Cash Position Report Multiple Banks If your company maintained 2 or 3 banks for payment processing, we have to adjust a little bit of the technique so that we can monitor effectively the entire bank's accounts and at the same time manage to earn extra income by carefully investing excess fund in a short term investment. Lets assume that your company has 3 bank accounts and we name it as Bank A, Bank B and Bank C. We should select one bank as your major bank where you pool all your cash in that bank. Let's assume that our main bank is Bank B. That means all your major collections must be deposited into this bank account. Your major expenditure which consists of big amount payment such as subcontractors and salary payment must also come from this cash pool account. Any payment prepared which is small in amount but the rate of recurrence is high such as utilities bills payment, petty cash reimbursement, staff claim and other payment should be prepared via Bank A. We will deposit the incoming cheques into Bank A with relatively the same amount of cheques prepared so that the account balance in Bank A is always in ideal balance. If we have a specific payment pattern for every month, for example we only disburse payment for our suppliers and workshop every 25th of the month, and then we use Bank C for our cheque payment. Here we use ZBA technique which means Zero Balance Accounts technique where we will only transfer fund from our cash pool account which is Bank B to Bank C only once a month. That means there is no extra cash in Bank C, which means we have pool all extra cash in Bank
28

B for our short term investment purposes. I will clarify further the topic of short term investment when we reach to that topic soon. All the recommended techniques above looks complicated but the reason behind this exceptional approach is that we would be able to prepare a daily cash position report more speedily and perfectly without spending your time to figure out the serial number for every categories if we just using only one bank . From our example above, you will notice that bank A is used for bills payment, staff claims and other payment. That means you only have to identify 3 series of serial cheque numbers for payment using Bank A. Bank B only has 2 types of payments which is subcontractors and salary while Bank C is planned for suppliers and workshop payment. The second reason of performing this approach is to avoid unused or idle balance in Bank A and Bank C which do not earn any interest income. All our collection has been pooled in Bank B where we can place a short term investment from a period of overnight to one week. To arrive at our bank balance for that day, we just compute by merely using simple calculation which is Opening Balance + Incoming Cheques - Payment made = Closing Balance. When placing the entire banks column side by side, we manage to observe the total closing balance when we total up Bank A, Bank B and Bank C closing balance. This is what I call the cash dashboard where we can see all our bank balance with a quick look. Certainly it is not complete yet because we still have not taken into consideration the available balance and cash & cash equivalent figures. I will explain in depth all this terms when we reach to that specific subject later on.

29

Lets Do it Step 1 How To Record Payments From Multiple Banks ~ Lets assume that we name Bank A as MBB, Bank B as CIMB and Bank C as RHB. Apart from it, as mentioned earlier Bank B or in our example here CIMB Bank, is also being regarded as a cash pool account where all major collections will be deposited into this account. Like wise, major payment such as payment to major subcontractors and salary will be prepared using this account as well. ~ As a normal practice and following the guiding principle by most of the treasurys manual, most of the corporations worldwide will create a cash pool account to accumulate cash as much as it can and at the same time to invest the surplus fund in a short term investment which the tenor will vary from an overnight placement till 1 week depending on the availability of fund and weekly working days conditions whether there is an extra public holiday on that week or not.

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

30

Prolink Enterprise Cash Position As At 7 Jan 2011


MBB CIMB RHB TOTAL

BALANCE B/F AS AT 31 DEC 2010 RECEIPTS Road Builder Inc ELITE Inc Sure Rich Inc Alpha Construction Beta Organization Others TOTAL RECEIPTS PAYMENTS Subcontractors Suppliers Utilities Bills Salary Others TOTAL PAYMENTS

15,000.00

50,000.00

25,000.00

90,000.00 25,000.00 27,000.00 0.00 14,000.00 0.00 9,500.00 0.00 75,500.00 35,000.00 5,500.00 1,500.00 7,500.00 1,500.00 51,000.00 114,500.00

25,000.00 27,000.00 14,000.00 9,500.00 9,500.00 52,000.00 14,000.00

35,000.00 5,500.00 1,500.00 7,500.00 1,500.00 3,000.00 42,500.00 5,500.00

BALANCE C/F

21,500.00

59,500.00

33,500.00

Figure 1.31 ~ After we have successfully transferred all the figures as per Figure 1.31. Transfer all the figures in the total column into the monthly cash flow report. Since your report is from 1 Jan 2011 till 7 Jan 2011, you only need to key in the numbers in a first week column only. Here it comes a report as per Figure 1.32

31

CHAPTER 5
Transactions At The End of The Month From my experience, in order for us to prepare a daily cash position in a more faster speed every morning, we need to strategize a certain technique so that our daily cash position can be viewed without spending a lot of time doing repetitious work such as recorded payment made several times a day.

What I did was, I normally will printout the payment listing for a certain bank after Ive last recorded the payment until their last payment activities. For example, lets say that my last report was dated on 15 Jan 2011 and I intend to prepare a report on 20 Jan 2011. That means I will only capture payment from 16 Jan 2011 until 19 Jan 2011 into my daily cash position report as at 20 Jan 2011. To avoid misunderstanding, payment made on 20 Jan 2011 will only be captured for the next daily cash position report such as report on 21 Jan 2011.

The reason of doing this is to keep us away from a mix-up as we have a tendency to prepare a payment several times a day. In essence, it is not practical to update our daily cash position report every time we prepare a payment, unless we have a very special reason to do so such as we have to fully monitor the cash position in an hourly basis due to a high volume of business transaction in a particular date. Otherwise, just stick to our normal procedure.

To capture the collection received, we have no choice but to record our collection on the same day itself. To keep up a good cash management system, what ever cheques that we have collected today must be deposited the soonest possible in
32

This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

33

FINAL THOUGHTS ______________________________________________


As a conclusion, by now you may realize that we had taken a lot of effort to learn and practice on how to prepare daily cash position report. Almost more than 50 pages have been devoted just to ensure that we are more than understand and capable of preparing the most important data in business and yet not really taught in business finance.

From my first experience in preparing the daily cash flow report in 1997 until now which is already the year of 2011, I have without endless effort trying to discover any financial or business book in the market from time to time which can teach us a dynamic daily cash flow report for business, unfortunately none of the finance book can give us a comprehensive guiding principle as I have given to you now.

I have spent more than 13 solid years, 8 hours a day trying to perfect the cash management system and off course this inclusive spending my time trying to comprehend the daily cash flow report as perfect as I can owing to the fact that this is the most important finance knowledge that you needs to master as a foundation of your cash management solid buildings structure.

From here, I will bring you with me to explore more secrets and techniques in cash management where you can learn how to make tonnes of money not only using your money but using other peoples money provided that you have an appropriate and powerful financial tools to use off which is one of my finance expertise.

34

Start practicing with a real corporate atmosphere in executing your business daily cash flow report. You will surprise that you now have a timely and perfect info in bringing your company to a right path towards a greater height of your financial dream and goal. And remember, practice makes perfect. Good Luck !

Attention !!
This is only a sample chapter and cannot be used as a guideline for preparing your business daily cash flow report. If you would like to buy a complete chapter of the book (which is 81 pages in total), please click on

http://uploadnsell.com/buy/WXi04L
and the price is only USD 9.99 and in pdf format. Once you have made your payment, you will be given a download link where you can download the pdf file in a couple of minutes.

Thank you Kamarulzaman Baharom

35