...businesses pay taxes on net profits, but they eat on cash flow.
Steve LeFever, Chairman, Profit Mastery
Seattle, WA (PRWEB) November 07, 2011
Profit Mastery has concluded their research and analysis of business danger signs and are announcing the results. The following list of 20 danger signals was compiled from field research with CPA's, lending institutions, Small Business Development Centers ("SBDC"), franchises, major corporations and small business owners.
This list represents a clear set of danger signals -- situations and issues -- that Profit Mastery believes has a clear and negative effect on cash flow.
1. An excess of unsold inventory
2. Customers not paying their bills on time
3. Tax obligations generally late -- and getting later
4. Writing business checks for personal expenses
5. Bank loan overdue
6. Paying suppliers late -- and getting later
7. Poor controls, presenting the opportunity for theft
8. Showing profits, but having no cash
9. Paying bills too early
10. Seasonal slump -- or boom -- creating cash shortage
11. Buying a large amount of fixed assets (like trucks)
12. Bank statements only reconciled once per year
13. Missing most purchase discounts
14. Excessive interest expense due to high loans
15. Expenses rising dramatically from past years
16. Financial reports only prepared once per year
17. Bad debts increasing
18. High volume inventory always out of stock
19. Payroll checks written late
20. No legal or accounting review
The research danger signals listed above can creep up on businesses even in good times. According to Steve LeFever, Chairman of Profit Mastery, the vital element regarding cash flow is thoughtful and proactive planning and management. "Businesses pay taxes on profits but they eat on cash flow. Cash flow is too often overlooked and is the lifeblood of any business," says Mr. LeFever.
Steve LeFever is the Founder and Chairman of Profit Mastery. Profit Mastery is an eLearning company that has trained over half a million people on how to measure and manage financial information to consistently increase business profits. Their innovative programs are available online in an on-demand, video program, which can be accessed 24/7/365. No financial knowledge is necessary for this powerful program that is used at leading institutions and universities. Interested participants can learn more about this enjoyable and affordable online educational course at http://www.profitmastery.net
Media Contact: Mr. Tim Riley, CEO, (206) 779-2021. riley(at)profitmastery(dot)net