Collapsible List

Chapter Name: Apply cash flow management in the running of a new venture

Description:Teaches how to track cash inflows and outflows, avoid shortfalls, and maintain liquidity.

Purpuse:To maintain solvency and support daily business operations.

Rational:Positive cash flow is critical for sustainability and operational success.

Chapter Assessment

Expected Supporting Evidence:

Portfolio of Evidence 1: The importance of cash flow management in a business is discussed in terms of the principles of a healthy business practice. - Explains how managing cash inflows and outflows maintains liquidity, supports decision-making, and avoids insolvency in a business.

Portfolio of Evidence 2: An explanation is given of the use of cash flow forecast as a budgeting tool. - Describes how cash flow forecasts help predict financial needs, monitor performance, and support budget planning.

Portfolio of Evidence 3: A cash flow forecast is created in accordance with recognised processes and steps. - Demonstrates the preparation of a forecast using standard steps: identifying cash inflows/outflows and timing, to ensure business readiness.

Portfolio of Evidence 4: A cash flow forecast is used in order to determine a working capital for a business. - Shows how cash flow forecasting reveals shortfalls or surpluses in liquidity, guiding appropriate working capital management.

Portfolio of Evidence 5: Bank statements are interpreted for reconciliation with the cash book. - Demonstrates how to cross-check bank statements with the cash book to identify discrepancies and ensure accurate records.